Theranos (2015): Two juries in San Jose

The Journal’s 2015 series, CMS inspection files, the SEC complaint, and two federal criminal trials in San Jose are the primary sources. They describe investor fraud proved to a jury, not a scientific mystery still waiting for a device. Theranos raised capital on the promise of decentralized, low-volume blood testing. A 2013 partnership with Walgreens put collection sites in stores and made the claim a consumer-facing fact, not only a Silicon Valley pitch.

Internal and later public records showed that many tests offered to patients were run on third-party analyzers, sometimes after diluting small samples, while the company’s own devices handled a narrower set. That gap is the factual core of the later fraud cases. Carreyrou’s October 2015 article, followed by more Journal reporting, forced the company into a defensive public posture. CMS inspected the Newark, California laboratory and in 2016 imposed sanctions, including a ban on Holmes’s operating labs for a period.

The FDA and CMS files, plus later SEC charges in March 2018, moved the story from a magazine dispute into the enforcement docket. The company dissolved in 2018 as the criminal case was prepared. Holmes’s trial (2021–2022) focused on what investors were told about technology, pharmaceutical-company validation, and the Department of Defense. The jury convicted on investor-fraud counts and acquitted or hung on others, including patient-related wire-fraud counts.