Theranos gave woman false-positive HIV result, then ghosted her

Theranos founder and former CEO Elizabeth Holmes, left, walks with her mother, Noel Holmes, as they arrive for Elizabeth Holmes' trial at the Robert F. Peckham Federal Building on November 17, 2021, in San Jose, California. Holmes is facing charges of conspiracy and wire fraud for allegedly engaging in a multimillion-dollar scheme to defraud investors.

Enlarge / Theranos founder and former CEO Elizabeth Holmes, left, walks with her mother, Noel Holmes, as they arrive for Elizabeth Holmes’ trial at the Robert F. Peckham Federal Building on November 17, 2021, in San Jose, California. Holmes is facing charges of conspiracy and wire fraud for allegedly engaging in a multimillion-dollar scheme to defraud investors. (credit: Justin Sullivan/Getty Images)

Before his firm’s investment in Theranos, Brian Grossman acknowledged certain risks. The company may not have its devices approved by the FDA. It might fail to deploy its machines as quickly as hoped. It might not be able to rein-in manufacturing expenses for its proprietary devices. Those gave him pause before his firm invested $96 million, but these were questions of execution, the stuff experienced investors like Grossman know how to assess.

But with Theranos, there were questions beyond execution, questions that even savvy investors didn’t think to ask. “Did you think one of the risks here was that the founder and CEO was not being truthful to you?” assistant US attorney Robert Leach asked Grossman yesterday in the criminal trial of Elizabeth Holmes, Theranos’ founder. 

“We did not think that was one of the risks,” Grossman replied.

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