Prosecutors ask a judge to sentence Elizabeth Holmes to 15 years in prison
ARI SHAPIRO, HOST:
Elizabeth Holmes was once a star of Silicon Valley, launching the blood testing company Theranos. Today she learned she'll spend more than 11 years behind bars for her role in defrauding investors out of millions of dollars.
NPR tech reporter Bobby Allyn has been in the courtroom. Hey, Bobby.
BOBBY ALLYN, BYLINE: Hey, Ari.
SHAPIRO: Why did the judge decide to send Holmes to prison for more than a decade?
ALLYN: The judge, Ed Davila in the northern district of California here in San Jose, made it really clear this fraud amount was staggering. It was hundreds of millions of dollars. Her lies to investors were egregious. When she was caught by regulators and when she was exposed by journalists, she retaliated and tried to cover it up. And most of all, it seemed that she was really driven by avarice. She was driven by - according to the judge, at least - that, you know, she wanted this lavish lifestyle. And he said sometimes in Silicon Valley, the pursuit of wealth and the pursuit of, you know, having lots of money can cloud your judgment. And that's what seems to have been the case with Elizabeth Holmes.
SHAPIRO: And it sounds like it was an emotional day. Tell us about what it felt like in there.
ALLYN: It was really emotional. Towards the end of the hearing, the judge said, are there any victims in the crowd? And a man raised his hand, and he stood forward. And he looked the judge directly in the eye, and he said, my name is Alex Schultz. He's the son of former Secretary of State George Schultz, who was one of the top investors in Theranos. And he talked about how Elizabeth Holmes completely duped his dad. He talked about how his son, Tyler Schultz, was a Theranos employee who later became a whistleblower. When Elizabeth Holmes found out that he had betrayed her and tried to expose the company, she had private investigators following him. He told the judge that his son was sleeping with a knife under his pillow because he was afraid he was going to be murdered at night. And was saying this in an incredibly powerful, emotional way, and the courtroom was just completely silent while he was saying this.
Then Elizabeth Holmes had her turn to speak, and she was sobbing profusely and was looking at the judge and said, there are many things that I wish I could do differently. I regret my failings with every cell of my being. And then, again, the courtroom just fell silent.
SHAPIRO: The judge tied this case to the history of Silicon Valley, the culture of tech. What's the larger lesson here?
ALLYN: The judge did make some statements about this, saying that, you know, lots of innovators, in order to grow their companies very fast, in order to scale, in order to become worth billions, sometimes cut corners. And what Elizabeth Holmes did here was not just exaggerate, not just inflate, not just hype a company but lie, lie repeatedly and lie flagrantly. And these flagrant lies ended up costing investors hundreds of millions of dollars. And, you know, he says he hopes that this does send a deterrent message to all of Silicon Valley that if you're going to try to be the next big innovator, if you want to try to be the next Steve Jobs, you got to do it honestly.
SHAPIRO: Elizabeth Holmes has become almost like a cultural figure with documentaries, a bestselling book, a TV series. Why do you think her story has attracted so much attention?
ALLYN: She's incredibly eccentric. She's charismatic. And the judge said himself, this case is a real shame because this woman is talented. He even said that she was brilliant. But she just got distracted by her greed. And the case fell apart, and now she's going to prison for 11 years.
SHAPIRO: NPR's Bobby Allyn in San Jose. Thank you.
ALLYN: Thank you, Ari. Transcript provided by NPR, Copyright NPR.