 Theranos CEO Elizabeth Holmes has been found guilty on four out of the 11 charges related to defrauding investors. And while the verdict sheds light on the legal accountability of making faulty promises, it actually further complicates the difference between the fake it till you make it mindset and fraud. When I heard that she was guilty, I wouldn't say that I was surprised, but I was interested in the way that it had broken down. The 11 charges against Elizabeth Holmes fell roughly into two buckets, defrauding patients and defrauding investors. She was found innocent of all of the patient stuff, all three of the underlying counts, plus the conspiracy charge. And then on the investor side, she was found guilty of conspiracy and three of the charges against her and the jury hung on three other charges. Liz Lopato is deputy editor at The Verge and has been covering Theranos since 2015. We heard only a very little from the patients. We heard from three patients and their testimony was like maybe an hour total, unlike the rest of the counts where we heard from some of these people for days. But there also wasn't a direct connection made between Holmes and the patients. And we didn't get enough about how involved Holmes was with the advertising and how much she had chosen to include or not include, how much of that was deliberate. I think it was easier to prove the charges against the investors because Holmes was literally in the room with them. We don't have to question where they got their information. We know. But that's not to say the patient's testimony didn't aid in the final verdicts. They heard from people who were having a hard time. They knew Holmes knew that people were having a hard time. Stuff was getting forwarded to her about retesting, about taking certain tests off the menu. You know, the jury knew that she knew everything was not right in the clinical lab, even if she wasn't intentionally defrauding patients. It's not a great outcome for her. The maximum she can be charged for each one of those wire fraud counts is 20 years. Now, I don't think she's going to get 20 years on each one of those counts. I could be wrong. It's possible that she won't see jail time. I don't think that's likely either. I think she is probably now looking at jail. Over the course of the trial, hundreds of people flocked to San Jose to catch a glimpse of Holmes and follow the courtroom drama. There were so many people who had read Bad Blood in their book clubs and just wanted to come see. People who were just interested. There was a person who worked in the biotech industry and was retired. This had been the subject of huge gossip in her friend group. And then there was one woman outside who was like, we love you, Elizabeth. You're a good mom. And the judge actually mentioned that doing that could potentially cause a mistrial if the jurors hear you and scolded her in court. We watch her get up and leave. So it was a mix. We had a little bit of goofiness. We had a little bit of seriousness. And on the stand, Holmes displayed the same control and image that she had become known for. In the courtroom, Elizabeth Holmes seemed immaculately controlled. Her posture was perfect. Even though the day was running really long, you could see her lawyers starting to wilt next to her. And she's sitting just like this, just absolutely straight up. She was pleasant. She was focused. She was keeping an eye on things. She was certainly engaged. But she also was a little distant, which, again, I understand this. If you're in a room full of reporters, maybe you don't want to engage with us. That might be the wisest move if you're on trial. That's fine. But the overall impression I got was that she seemed like she had a tremendous amount of self-possession and self-control and that that was really the thing that I was struck by throughout. But as the reality of the trial began to set in, there was a shift. There was a period where she was undergoing her direct questioning by her lawyers, where I had this impression that she was realizing how serious the situation was in real time as she was trying to respond to some of the things that she'd heard the other witnesses say. And it was sort of horrible to have somebody realize how serious things are for them when they are literally on the witness stand. That was sort of awful to watch. I can't help but think that it was partially because of this impression I got of her, of somebody who really prepares, who was probably an A student who brought the teacher an apple, who really gave great testimony when she had prepared it and kind of knew what she was going to say. But whenever there was a question that was kind of on the fly, she got nervous. And she was really nervous during her cross-examination. But there was certainly a kind of waiver in self-control when she was testifying and had been up there for a couple of hours and was clearly getting tired. As we await Holmes' sentencing and inevitable appeals, the trial of Sunny Balwani, Theranos' former president and chief operating officer, is about to begin. He's facing the same charges. Sunny and Elizabeth were originally going to be tried together, but because of her allegation of abuse, which was raised in sealed pretrial motions, their trials were severed. Now this is actually a pretty good thing for both of them because it gave them the freedom to blame each other in their separate trials. You know, Elizabeth Holmes definitely did. She definitely said, oh, Sunny was responsible for this. Oh, Sunny was responsible for that. Oh, the financial projections that were weird, that was Sunny. It wasn't super credible, but I imagine he's going to do the same thing and say, look, she was the CEO. Like, this was Elizabeth. This was Elizabeth. Elizabeth was the one who talked to these people. This was Elizabeth. So I imagine that's probably good for him. But the guilty verdict for Holmes might cue us into the outcome of the case against Balwani. Finding her guilty on the conspiracy count is bad news for him. It suggests that there's enough evidence of the conspiracy on at least one end to convict. And if there's enough evidence on one end, there's probably enough evidence on the other. I am interested about the patient stuff. He was more directly involved with the clinical lab. And so that may work out differently for him. But in terms of the investor counts, you know, some of these investors testified that they were dealing directly with Sunny. And I am curious to see how his trial is different. Regardless of her sentencing or the outcome of Balwani's case, having a CEO or COO of a company on trial is a rare spectacle. And it's unlikely to happen again for a long time, but not necessarily because anyone will actually learn anything from Theranos' mistakes. A lot of people want to say, well, she's not Silicon Valley. And I understand that impulse because I wouldn't say she's representative of Silicon Valley, but she's certainly a product of it in the same way that like Bernie Madoff is not representative of Wall Street, but he's certainly a product of it. But because so many people don't seem to want to acknowledge that she's even a part of this world, I don't think we're going to see a lot of behavior changes. And even with the verdict, investors might not change their tune in investing in future companies with such bold claims. We're in this like very frothy period where there's a lot of money available and investors really aren't doing as much due diligence as they should be. That worries me because that's the kind of situation where fraud can potentially flourish. With Theranos, it just looked like a successful company until all of a sudden it wasn't. And I don't know how many of those kinds of things are out there lurking around right now. But I do find myself wondering if we're going to see changes in terms of compliance or in terms of what lawyers recommend to their clients as a result of that, because I don't see investor behavior changing. I don't necessarily see founder behavior changing.
 Theranos CEO Elizabeth Holmes has been found guilty on four out of the 11 charges related
 to defrauding investors.
 And while the verdict sheds light on the legal accountability of making faulty promises,
 it actually further complicates the difference between the fake it till you make it mindset
 and fraud.
 When I heard that she was guilty, I wouldn't say that I was surprised, but I was interested
 in the way that it had broken down.
 The 11 charges against Elizabeth Holmes fell roughly into two buckets, defrauding patients
 and defrauding investors.
 She was found innocent of all of the patient stuff, all three of the underlying counts,
 plus the conspiracy charge.
 And then on the investor side, she was found guilty of conspiracy and three of the charges
 against her and the jury hung on three other charges.
 Liz Lopato is deputy editor at The Verge and has been covering Theranos since 2015.
 We heard only a very little from the patients.
 We heard from three patients and their testimony was like maybe an hour total, unlike the rest
 of the counts where we heard from some of these people for days.
 But there also wasn't a direct connection made between Holmes and the patients.
 And we didn't get enough about how involved Holmes was with the advertising and how much
 she had chosen to include or not include, how much of that was deliberate.
 I think it was easier to prove the charges against the investors because Holmes was literally
 in the room with them.
 We don't have to question where they got their information.
 We know.
 But that's not to say the patient's testimony didn't aid in the final verdicts.
 They heard from people who were having a hard time.
 They knew Holmes knew that people were having a hard time.
 Stuff was getting forwarded to her about retesting, about taking certain tests off the menu.
 You know, the jury knew that she knew everything was not right in the clinical lab, even if
 she wasn't intentionally defrauding patients.
 It's not a great outcome for her.
 The maximum she can be charged for each one of those wire fraud counts is 20 years.
 Now, I don't think she's going to get 20 years on each one of those counts.
 I could be wrong.
 It's possible that she won't see jail time.
 I don't think that's likely either.
 I think she is probably now looking at jail.
 Over the course of the trial, hundreds of people flocked to San Jose to catch a glimpse
 of Holmes and follow the courtroom drama.
 There were so many people who had read Bad Blood in their book clubs and just wanted
 to come see.
 People who were just interested.
 There was a person who worked in the biotech industry and was retired.
 This had been the subject of huge gossip in her friend group.
 And then there was one woman outside who was like, we love you, Elizabeth.
 You're a good mom.
 And the judge actually mentioned that doing that could potentially cause a mistrial if
 the jurors hear you and scolded her in court.
 We watch her get up and leave.
 So it was a mix.
 We had a little bit of goofiness.
 We had a little bit of seriousness.
 And on the stand, Holmes displayed the same control and image that she had become known
 for.
 In the courtroom, Elizabeth Holmes seemed immaculately controlled.
 Her posture was perfect.
 Even though the day was running really long, you could see her lawyers starting to wilt
 next to her.
 And she's sitting just like this, just absolutely straight up.
 She was pleasant.
 She was focused.
 She was keeping an eye on things.
 She was certainly engaged.
 But she also was a little distant, which, again, I understand this.
 If you're in a room full of reporters, maybe you don't want to engage with us.
 That might be the wisest move if you're on trial.
 That's fine.
 But the overall impression I got was that she seemed like she had a tremendous amount
 of self-possession and self-control and that that was really the thing that I was struck
 by throughout.
 But as the reality of the trial began to set in, there was a shift.
 There was a period where she was undergoing her direct questioning by her lawyers, where
 I had this impression that she was realizing how serious the situation was in real time
 as she was trying to respond to some of the things that she'd heard the other witnesses
 say.
 And it was sort of horrible to have somebody realize how serious things are for them when
 they are literally on the witness stand.
 That was sort of awful to watch.
 I can't help but think that it was partially because of this impression I got of her, of
 somebody who really prepares, who was probably an A student who brought the teacher an apple,
 who really gave great testimony when she had prepared it and kind of knew what she was
 going to say.
 But whenever there was a question that was kind of on the fly, she got nervous.
 And she was really nervous during her cross-examination.
 But there was certainly a kind of waiver in self-control when she was testifying and had
 been up there for a couple of hours and was clearly getting tired.
 As we await Holmes' sentencing and inevitable appeals, the trial of Sunny Balwani, Theranos'
 former president and chief operating officer, is about to begin.
 He's facing the same charges.
 Sunny and Elizabeth were originally going to be tried together, but because of her allegation
 of abuse, which was raised in sealed pretrial motions, their trials were severed.
 Now this is actually a pretty good thing for both of them because it gave them the freedom
 to blame each other in their separate trials.
 You know, Elizabeth Holmes definitely did.
 She definitely said, oh, Sunny was responsible for this.
 Oh, Sunny was responsible for that.
 Oh, the financial projections that were weird, that was Sunny.
 It wasn't super credible, but I imagine he's going to do the same thing and say, look,
 she was the CEO.
 Like, this was Elizabeth.
 This was Elizabeth.
 Elizabeth was the one who talked to these people.
 This was Elizabeth.
 So I imagine that's probably good for him.
 But the guilty verdict for Holmes might cue us into the outcome of the case against Balwani.
 Finding her guilty on the conspiracy count is bad news for him.
 It suggests that there's enough evidence of the conspiracy on at least one end to convict.
 And if there's enough evidence on one end, there's probably enough evidence on the other.
 I am interested about the patient stuff.
 He was more directly involved with the clinical lab.
 And so that may work out differently for him.
 But in terms of the investor counts, you know, some of these investors testified that they
 were dealing directly with Sunny.
 And I am curious to see how his trial is different.
 Regardless of her sentencing or the outcome of Balwani's case, having a CEO or COO of
 a company on trial is a rare spectacle.
 And it's unlikely to happen again for a long time, but not necessarily because anyone will
 actually learn anything from Theranos' mistakes.
 A lot of people want to say, well, she's not Silicon Valley.
 And I understand that impulse because I wouldn't say she's representative of Silicon Valley,
 but she's certainly a product of it in the same way that like Bernie Madoff is not representative
 of Wall Street, but he's certainly a product of it.
 But because so many people don't seem to want to acknowledge that she's even a part of this
 world, I don't think we're going to see a lot of behavior changes.
 And even with the verdict, investors might not change their tune in investing in future
 companies with such bold claims.
 We're in this like very frothy period where there's a lot of money available and investors
 really aren't doing as much due diligence as they should be.
 That worries me because that's the kind of situation where fraud can potentially flourish.
 With Theranos, it just looked like a successful company until all of a sudden it wasn't.
 And I don't know how many of those kinds of things are out there lurking around right
 now.
 But I do find myself wondering if we're going to see changes in terms of compliance or in
 terms of what lawyers recommend to their clients as a result of that, because I don't see investor
 behavior changing.
 I don't necessarily see founder behavior changing.