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Counts Dropped, Sentencing Delayed, Out Free: White Privilege At Work For Elizabeth Holmes?

It’s difficult to imagine a Black or Latino man getting similar treatment in the criminal justice system.

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(Photo by Justin Sullivan/Getty Images)

The downfall of fraudulent blood testing company Theranos and its founder Elizabeth Holmes captivated a lot of people. Even when Holmes was hailed as the world’s youngest female self-made billionaire, for anyone who knew a bit about biotech, it seemed hard to believe that someone who dropped out of college during her sophomore year could be technically adept enough to revolutionize the blood testing industry.

That’s why Holmes specifically targeted influential but biomedically ignorant people to become her investors and board members. They couldn’t see her fraud for what it was. She might still be getting away with it today if not for the intrepid reporting of John Carreyrou, who brought the whole thing to light. If you haven’t yet read Carreyrou’s book Bad Blood: Secrets and Lies in a Silicon Valley Startup, I’d recommend it. The text is full of surprising and entertaining details that even the biggest news junkies won’t have gotten from the Holmes trial coverage.

I hope I’m not revealing any spoilers here by disclosing that following a months-long trial, Elizabeth Holmes was convicted on four felony charges for defrauding investors — three counts of wire fraud, and one count of conspiracy to commit wire fraud. Each count carries a maximum sentence of 20 years, and theoretically the sentences could run consecutively for a total of up to 80 years (although it is much more likely that the judge will allow the sentences to run concurrently). If I were a betting man, I would wager that Holmes won’t face anywhere close to even one full 20-year prison term though.

When word of Holmes’s convictions dropped, the first person I spoke to about the news was a good friend of mine who had also been following the trial closely. “Are you shitting me?” were his exact words. He was upset that Holmes had been convicted on only four of the 11 counts she had been initially charged with, despite seeming pretty guilty. “White privilege,” he said, as someone who knows a lot more about it than I do as a white dude.

Yes, Elizabeth Holmes was convicted on four counts, each of which carries a potentially serious prison term. But she was acquitted on four other charges, and the jury deadlocked on the remaining three charges. A hung jury means that prosecutors can try a defendant again, but the government already said in a filing that it will dismiss the three counts on which the jury was unable to reach a verdict rather than retrying Holmes on those counts.

Prosecutors also proposed setting a sentencing hearing for September 12 — more than nine months after the end of her trial — and said they were agreeable to Holmes remaining free on a $500,000 bond secured by property in the meantime. To put the $500,000 bond in context, keep in mind that several high-profile investors in Theranos reportedly lost a combined $600 million. Furthermore, although it’s difficult to assess exactly how much Holmes paid her defense team during trial, she had an army of high-powered white collar defense lawyers, and I’ve heard credible experts estimate that such a legal defense would have cost any similarly situated defendant in the neighborhood of $10 million.

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Maybe there are good reasons that triable counts against Holmes were dropped before anyone even knows what her sentence will be for the counts she was convicted on. Sure, if the idea was to send a message to Silicon Valley to reign in the hyperbole, perhaps any criminal conviction would do. Maybe there are also good reasons for Holmes to be out on such a paltry bail amount, even though she is coming up with millions of dollars to drop on a failed legal defense and even though she scammed her investors out of hundreds of millions of dollars. Maybe there are even good reasons to delay sentencing for nine months — hey, we’re all busy, I suppose.

There are reasons behind these decisions. Yet, despite the fact that nobody’s going to say out loud or admit to themselves that they’re handling Elizabeth Holmes with kid gloves because she’s a pretty white lady, it’s difficult to imagine a Black or Latino man getting similar treatment in the criminal justice system.

I told my friend that 10 years ago, someone like Elizabeth Holmes probably would have gotten off entirely for her crimes. Maybe in another 10 years someone like her will get convicted on all counts and be put away immediately. That’s progress, I said, even if it doesn’t really help a poor minority defendant today who’s convicted of some far less serious crime. But I didn’t feel very good about it even as I said it.

Jonathan Wolf is a civil litigator and author of Your Debt-Free JD (affiliate link). He has taught legal writing, written for a wide variety of publications, and made it both his business and his pleasure to be financially and scientifically literate. Any views he expresses are probably pure gold, but are nonetheless solely his own and should not be attributed to any organization with which he is affiliated. He wouldn’t want to share the credit anyway. He can be reached at jon_wolf@hotmail.com.

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