December 2022 | Volume 14, Issue 5

Find the full video and article in The Wall Street Journal.

Discussion Questions

  1. As the video indicates, Elizabeth Holmes was convicted of four counts of fraud. Define fraud. More particularly, what was the fraud alleged in this case?
    Fraud is defined as:
    - A false statement of fact;
    - Made with knowledge of its falsity or reckless disregard for its truth;
    - Made with the intent that the listener rely;
    - The listener does rely; and
    - The listener is harmed as a result (economically, physically, or both).

    The fraud alleged in this case is based on Ms. Holmes misleading investors and others regarding the efficacy of Theranos’ technology (more specifically, the ability of the technology to run hundreds of blood tests from a single drop of blood on Theranos “Edison” machine).
  2. As the video indicates, the prosecution, the defense, and a probation officer were allowed to recommend Ms. Holmes’ sentence length to the judge. Do you favor allowing various parties to make such recommendations, or should the judge impose the sentence length based exclusively on structured sentencing guidelines and their individual discretion (to the extent that individual judicial discretion is allowed in sentencing)?
    This is an opinion question, so student responses may vary. Regarding federal sentencing, there are structured sentencing guidelines in place that limit the range in which a defendant can be punished (via imprisonment) for the commission of a particular crime. Within that range, the sentencing judge can take recommendations from the prosecution, the defense, and others regarding whether the punishment should be aggravated (increased) or mitigated (decrease) from the “baseline” punishment provided by the structured sentencing guidelines. In your author’s opinion, receiving the recommendations of the prosecution, the defense, and others is good practice, and helps to provide a more “holistic” decision regarding what the punishment for the particular crime should be (again, keeping in mind the constraints imposed by federal structured sentencing guidelines).
  3. The video references a “surrender date” of April 27, 2023. What is a surrender date? Are you surprised that the surrender date is not until well into next year?
    The surrender date is the date the defendant must surrender to authorities and begin serving the sentence the court has imposed on the defendant. As indicated in the video, Ms. Holmes’ surrender date is April 27, 2023, some five months after the court made the actual sentencing decision. In your author’s opinion, this is time for Ms. Holmes to get her “house in order” prior to serving the sentence, recognizing the fact that she has a four-month-old child and is pregnant with her second child. Critical minds might question whether an “ordinary” defendant would be provided the same accommodation.