HBO Tells Only Part of ‘Inventor’ Elizabeth Holmes’ Story

“The fraud and deception surrounding Theranos has been well-documented, and a trial date set for its founder [Elizabeth Holmes]. The role of Silicon Valley investors and researchers will be more difficult to discern.” was based on the promise that a charismatic 19-year-old Stanford drop-out, Elizabeth Holmes, had developed a revolutionary technology that could perform important diagnostic tests by using a drop or two of blood.

Whatever the outcome of a planned three-month trial set to begin next August in San Jose federal court, there may never be a full accounting of the destructive power of a good story well-told. The attitudes that allowed Theranos and Holmes to operate undetected and for investors to be duped out of more than a half-billion dollars do not appear to have changed.

“The Inventor: Out for Blood in Silicon Valley,” a documentary released by HBO earlier this year, effectively dramatizes an extraordinary narrative: engineering student founds a diagnostics company like no other; attracts top advisors; raises $700 million over several years. The company’s valuation soars to $9 billion. Holmes’ net-worth is $4.5 billion. She is on the cover of Forbes and Fortune, one of the most successful businesswomen in history.

The film is effective at probing the border between breakthrough ideas and business reality, between style and substance—memes to which the bright and privileged have become especially vulnerable. The Theranos story resonates in Silicon Valley and on Wall Street, where anything seems possible, and casts a shadow on intellectual property rights like patents, which may appear more convincing on paper than in practice.

Two-Hundred Patents

Theranos founder and primary inventor, Holmes, is associated with more than 200 patents, some still issuing in 2019. She perpetrated one of the most heinous frauds of the 21st Century—what may prove to be her most lasting “invention.”

How do 200 patents translate into one big lie?

“The Inventor” director, Alex Gibney, invokes Thomas A. Edison, “who often promised more than he could deliver.” Gibney suggests that Edison was the most prominent if not the first professional inventor to make acceptable an old idea: “fake it ’til you make it”.

Edison and Nikola Tesla, two of the greatest inventors, were known to have presented some of their work as products when they were, in fact, still being worked out. Edison and Tesla were not the first innovators to do so, nor will they be the last. For Holmes and Theranos, framed patents in the lobby and marketing hype aside, a great deal more needed to be achieved with their diagnostics technology than ironing out a few kinks. Theranos named its device “Edison.”

The list of experienced investors and advisors who were unaware of “Edison’s” lack of efficacy included David Boies, the well-known litigator; Richard Kovacevich, the ex-CEO of Wells Fargo; two former U.S. Secretaries of State, Henry Kissinger and George Shultz; and Secretary of Defense General James Mattis, who helped recruit investors. The Theranos investor list reads like a who’s-who of Stanford University alumni and distinguished military veterans. They included Silicon Valley veterans Tim Draper and Larry Ellison and media mogul Rupert Murdoch.

A Cautionary Tale

What is there to be learned from Holmes’ deception? Was she merely a greedy charlatan or did she believe that with sufficient time and capital the promise of Theranos’ diagnostics would be realized and no one would care if a few early liberties were taken? Or was Holmes simply caught up in the mythology of Silicon Valley’s power elite, unable (or unwilling) to extricate herself?

Holmes faces nine counts of mail fraud and two counts of conspiracy to commit wire fraud. Each count carries a maximum of 20 years in prison. It would be bad enough if the deception involved a new method of buying laundry detergent or finding a date for Saturday night—it is far worse when disease-critical medical information is involved.

There is no question that a degree of showmanship exists when it comes to inventing and investing. Edison and Tesla certainly knew that. So do others like Steve Jobs and Elon Musk. Simply drinking the Kool-Aid, on the other hand, saved no one in Jonestown; it does not go down much better in Palo Alto.

Invention is often more art the science, especially in the early stages, when objectives are still evolving and focus may need to be refined. Uncertainty about where a novel idea might lead or what form it may eventually take is not unusual, but falsifying results is a zero-sum game.  In competitive settings, amidst the pressure to perform, it can be difficult to distinguish fact from fiction, let alone right from wrong. In the film, even award-winning journalists like The New Yorker’s Ken Auletta and Fortune’s Roger Parloff reluctantly admit they succumbed to Theranos’ apparent success.

Inventors need the confidence to believe but must avoid the temerity to lie. In the process they may occasionally deceive themselves and others about the pace or level of progress. They must be mindful of crossing the line that separates expandable fact from believable fiction.

Gibney’s eye-opening film is important on several levels. However, its suggestion that “faking it ‘til you make it” is what many innovative businesses and professional inventors (like Edison) typically do, is inaccurate and disrespectful. Vaporware is the 1980s term for software that is sold with a promise to solve a problem for which a solution has yet to be identified. It was, and still is, promoted on the belief that the brightest minds can figure out just about anything with sufficient time and capital. Well, at least some of the time.

Who Are We?

What does the Theranos story tell us about ourselves and the current environment for ideas and business? Was Holmes merely the consummate liar who understood the conditions necessary for deception?

Or, did those associated with Theranos, employees included, effectively invite disaster by believing that partial truths could become whole ones, and that eventually they may no longer be lies? It has yet to be determined how deeply they were in the dark.

People love to be part of something grand; to believe they are thinking differently or early supporters of the next big thing. Holmes was the perfect icon for their affection—a rather mysterious young woman, clad in black turtlenecks (like Jobs) who literally seemed to never blink, and projected a nerdy self-confidence. The seduction of promoting good science while generating an outsized return-on-investment can prove irresistible.

“The Inventor: Out for Blood in Silicon Valley” is an unsettling story, worthy of a novel or fiction film. In the end it will reveal as much about ourselves and current period of discovery as it does about Holmes and her motivation.

Image Source: Deposit Photos
Image ID: 45945793
Copyright: zimmytws 

This article was updated on September 3 to correct a typo in the name of the school Holmes attended (Stanford, not Stamford).



Warning & Disclaimer: The pages, articles and comments on do not constitute legal advice, nor do they create any attorney-client relationship. The articles published express the personal opinion and views of the author as of the time of publication and should not be attributed to the author’s employer, clients or the sponsors of

Join the Discussion

29 comments so far.

  • [Avatar for Douglas Gray]
    Douglas Gray
    November 27, 2019 04:56 pm

    If her civil case lawyers are quitting due to not being paid, I cannot figure out how she can pay the lawyers for the criminal case; seems that one will be more costly in the long run.

    One lady was interviewed about Therano’s false positive results for her cancer “recurrence.” Scared her to death, but she had another lab follow up and it indicated she was fine. The Courts are generally very severe with “snake oil salesmen” and this is pretty close too it.

    Also, Phyllis Gardner gave the example of the narrow window on clotting/anti-clotting medication. Too much in either direction could be life threatening. Madoff got a big sentence, but none of his deception was life threatening. This is different.

  • [Avatar for Melisa]
    November 21, 2019 11:12 am

    Holmes is worth nothing, but before this broke Forbes, Fortune, etc valued her at almost a billionaire.. This is why no one should ever try to count other people’s or a company’s money unless they have access to their financials. Get what I’m saying?

  • [Avatar for Truth Seeker]
    Truth Seeker
    October 19, 2019 01:37 am

    @ Bruce Berman

    Doesn’t answer our other questions (especially whether or not the PTO acts in a fair, consistent and ‘blind’ manner when it comes to the examination of inventions). I don’t believe our patent system works the way it is supposed to work (or used to work), in accordance with the Constitution! Standards and consistent outcomes used to be much higher in the past and, in the beginning, you even had to PROVE your invention worked as claimed (if asked to do so by the PTO).

    By not even having to THINK if a proposed new technology ‘does’ work or ‘could’ work as claimed, the whole system is reduced to just a bunch of B.S. & ‘scientific nonsense’ that makes a complete ‘mockery’ of the what the Founders’ originally intended (i.e., to advance the ‘sciences’ & the useful arts)! They wanted to reward THINGS THAT WORKED and could benefit society – not just to issue WORTHLESS pieces of paper that could be used to DUPE the public & investors, instead of delivering on what those pieces of paper claimed!

    Investors SHOULDN’T HAVE TO worry if a patent is any good at all, because that’s what Examiners are PAID to do (or at least WERE paid to do in the past). They shouldn’t have to hire expensive law firms to look at EVERY one of 200 or more patents (which might cost more than they want to even invest), before they decide to invest! That’s just stupid and a ridiculous waste of even more money, particularly if every investor has to repeat such vetting on their own!

    It’s the PTO’s responsibility to only allow ‘reasonably good’ and likely ‘defensible’ patents – NOT worthless declarations & disclosures that get overturned on a dime! Patents are no longer enforceable (at reasonable costs). That has HUGE economic ramifications that didn’t exist 100 years ago! Patents had actual value then & they are what made America second to none & what brought Nikola Tesla here! He could have just as well stayed in Europe if he didn’t care about protecting his ideas and inventions and being compensated for his creative work. Our country no longer values most creative work – that’s the problem!

  • [Avatar for Bruce Berman]
    Bruce Berman
    October 14, 2019 01:07 pm

    USPTO is the United States Patent and Trademark Office. Much if not all of Holmes’ net worth was tied up in Theranos stock. That’s likely why she is broke.

    The USPTO is responsible for determining initially what is likely inventive. It does not address the viability of inventions or investments based on them. Ironically, or tragically, some of the Theranos patents may still have merit, even if the company, it’s products and its executives do not.

  • [Avatar for Paris Merriam]
    Paris Merriam
    October 14, 2019 10:15 am

    Truth Seeker, please tell us what all of these initials mean (USPTO, PTO). I am assuming it has something to so with patents, right?

  • [Avatar for Truth Seeker]
    Truth Seeker
    October 14, 2019 03:32 am

    The USPTO & its examiners & supervisors may actually have been ‘complicit’ in the ‘rubber stamping’ of Theranos’ applications! And we think the JD and/or the FBI should now investigate the entire USPTO and what’s going on there!

    Takes us YEARS to get a single good patent. How could Theranos possibly get so many patents, effectively ‘rubber-stamped’, in so few years, with no evidence of their having to battle the PTO for any of them?! This just makes no sense (especially statistically)! Who else gets patents in 1-2 years on supposedly significant & ‘groundbreaking’ technology?!! It sure doesn’t happen to us! We’re STILL waiting after YEARS! We must not have the money or connections necessary, eh?!

    All we can say now is that something doesn’t smell right at the PTO! It just doesn’t pass the smell test (and we have some hard evidence of that)! What do you think?

  • [Avatar for Paris Merriam]
    Paris Merriam
    October 12, 2019 11:33 am

    Thanks Melissa, but I mentioned Theranos and Holmes are worth zero now according to the two magazines. But I made a mistake; she stole $700 million from investors, not $700,000. What I don’t understand is how Holmes is now broke and has multiple attorneys (criminal and civil case). At some point she will only have a public defender, as her civil attorneys want off of the case. Perhaps a plea deal might be her best option, as beating the feds is difficult, and it could carry more time.

  • [Avatar for Melissa]
    October 12, 2019 11:15 am

    This is why it’s problematic for Forbes & Fortune or any entity or person to try to count other people’s money or a company’s money when they don’t have access to their books.
    By the way, Forbes & Fortune player victim and said the record has since been corrected to $0

  • [Avatar for Paris Merriam]
    Paris Merriam
    October 11, 2019 03:33 pm

    “but falsifying results is a zero-sum game”. Well said. Not sure if each count of wire fraud carries 20 years. Perhaps the 11 counts of wire fraud does. Elizabeth Holmes kept this scam going for 15 years. $700,000 of investors money up in smoke. One has to wonder about Forbes and Fortune as well. $4.5 billion net worth for her, and Theranos is worth $7 billion? Now both are worth zero, according to the same magazines. Why would these magazines promote a scam artist without doing their research? Something’s a little fishy there. Also, Elizabeth Holmes can no longer afford her attorneys, and they want off of her civil case which is separate from her criminal trial. And her patents keep coming in? That’s a little scary.

  • [Avatar for Melissa]
    September 14, 2019 11:32 pm

    Broken System,
    I think Fortress company who loaned Theranos their last 100+ mil took their parents. Sadly, most of the parents were practically stolen. The owners couldn’t afford the court battles. One name comes to mind is Richard Fuisz, psychiatrist, ex CIA officer – and he couldn’t afford the legal battle. Indeed, Broken System.

  • [Avatar for Melissa]
    September 14, 2019 11:27 pm

    Hi Bruce,
    What gets me is, Phyllis Gardner the so called hero who referred Elizabeth to Professor Robertson, apparently Holmes drove Phyllis nuts, Elizabeth had crazy ideas such as wanting to make a patch that delivered anabiotic’s – according to Phyllis it could not be done and Elizabeth also mentioned the idea of the one blood drop and again Gardner told her it could not be done.
    I guess what I am trying to say is, you have people like Phyllis and these pathologists; Adam Clapper saying they knew it was impossible but never bothered contacting the magazines Elizabeth was on, CMS, Board Of Health [ Insert Department Here] instead they wrote a post on their blog that barely got 100 visitors a month. I would think when they took their oath when awarded their medical degrees would mean something?
    So the likes of the mentioned above and Robertson, in my opinion, are just as guilty. Phyllis even said on interview she knew investors would lose money .

  • [Avatar for Bruce Berman]
    Bruce Berman
    September 13, 2019 01:30 pm

    There are some patient suits as reported in Dark Daily, a clinical lab and pathology trade publication, and USA Today.

  • [Avatar for Marina Parker]
    Marina Parker
    September 13, 2019 01:10 am

    The difference between Theranos and just about every other startup out there is is that their “vaporware” performed blood tests on thousands of patients who may have relied on the (inaccurate) results of those tests, and whose reliance on those tests may have in fact led to some deaths. This is an angle that is rarely discussed. If somebody DID die then Elizabeth Holmes’s reckless disregard for that possibility could, I believe, be prosecuted as second degree murder in a criminal court.

  • [Avatar for Bruce Berman]
    Bruce Berman
    September 9, 2019 09:45 am

    Melissa, I believe that you are referring to Channing Robertson, and yes, it does appear that he, and others, could have done more to expose Theranos earlier. The following is from the Wikipedia entry about him:

    “Robertson taught Theranos founder Elizabeth Holmes when she was a student at Stanford, and he went on to become the company’s first board member.[4][5] He convinced Ian Gibbons to work for Theranos in 2005.[6] In 2017, Theranos named him the co-leader of their technology advisory board.[7]

    “Even as Theranos was coming under growing scrutiny, as of May 2018, Robertson still believed the company was successful in developing novel blood testing technology. According to lawyer Reed Kathrein, who sued Theranos on behalf of some of its former investors, the company only paid Robertson to lend itself credibility.[8]”

  • [Avatar for Melissa]
    September 8, 2019 10:12 pm

    What everyone keeps missing is Channing Roberts. He keeps going untouched. Unacceptable. Channing is the one who knew and did nothing.

  • [Avatar for step back]
    step back
    September 6, 2019 06:02 am

    Rob @13

    The case law appears to say that non-enabled patents cannot be used for anticipation (section 102 rejections). However, ideas/ teachings presented in such patents can be used in combination with others under section 103 (obviousness rejections) if the combination as a whole is enabling.

    (Disclaimer: This should not be construed as legal advice for anyone. Do not use the internet as your source of information. Consult directly with an attorney or patent agent.)

  • [Avatar for Rob S]
    Rob S
    September 5, 2019 09:21 pm

    I’d like to hear the opinions of experts in patent law on the following. What impact do the Theranos patents, fanciful as they are, have on the future of medical device IP?

    I’ve read the first Holmes patent from 2003 that was granted in 2018 and one of the 2011 patents that appear to enable the Edison. Both to me, as a biomarkers/diagnostic device scientist, appear to be unrealizable. However, the ideas presented in them are now prior art – with what impact?

  • [Avatar for Concerned]
    September 4, 2019 07:23 am

    Great article and great responses!

    I see so many similarities to the sub prime mortgage scam and the current patent system.. The sub prime mortgage scam ended poorly, the patent system looks to end poorly also.

    As Warren Buffett points out, people (and scams) can swim naked for a long time until the tide rolls out and exposes the nakedness.

  • [Avatar for E. Ham]
    E. Ham
    September 4, 2019 03:53 am

    I am the holder of a corporate patent, a method that uses reflected infrared to detect an object. In of itself, it was not a breakthrough, several such mechanisms were on the market. My implementation gained its patent due to some clever software that made it extremely resistant to unforeseen infrared radiation (like sunlight). Through manipulation of the original patent by a experienced (and devious) patent attorney, the basic patent was leveraged into several more, none of which I had anything to do with, and in fact were nearly as much of a scam as Theranos.

    The US Patent system is badly broken and needs a serious overhaul. Numerous patents are granted on the slimmest of criteria and it is nearly impossible for the lone-wolf engineer or inventor to gain a patent if for no other reason than the costs to do so are beyond reality.

  • [Avatar for Bruce Berman]
    Bruce Berman
    September 3, 2019 06:15 pm

    Thank you, Michael, for the clarification on the number of issued patents. The 200 count was reported in Hacker News and several other publications. They likely meant worldwide grants and applications. Five Theranos patents were granted by the USPTO a few weeks ago even though the company is officially defunct since 2018.

  • [Avatar for Michael J. Lang]
    Michael J. Lang
    September 3, 2019 02:07 pm

    Actually, Ms. Holmes is listed as an inventor on 84 US Patents, the first of which has a priority date of 2003. The claims in many of these patents would not pass the current Alice test. Since no company has seriously attempted to acquire these patents, the market has determined that the true value of this patent portfolio is near zero.

    The HBO documentary was excellent and I highly recommend watching it.

    It confirmed that an aging George Shultz was duped but his name brought in a lot of investors. David Broies knew exactly what was there and sent threatening letters to ex-employees and filed injunctions to prevent whistle blowers from disclosing the fraud. He even filed suit against George Shultz’s grandson, who was working at Theranos and was one of the key whistle blowers. Finally, the interviews of her Stanford professors were very interesting.

  • [Avatar for John D]
    John D
    September 3, 2019 01:30 pm

    Not unlike the HBO doc, your article’s assumption of the facts and conclusion appears to hold water and yes, Holmes defense, like her avarice ambition is based on the old saying, “the end justifies the means”.
    One didn’t have to be a medical genius or computer nerd to blow the whistle on Theranos, from my unrelated work experience, employees close to Holmes share responsibility with the fraud perpetrated by her. Most of us know from wrong, we learn right from wrong as children, usually from a spanking or embarrassment or both. The first kneejerk of suspected activity should have been much earlier, but self-preservation of underlings can be an enabler to those on-high. And that’s our society needs to protect and reward whistle blowers.
    It ain’t easy to stand against greed and complacency. I paid dearly when I blew the whistle on my employer for embezzling $935k from a bank. A judge who was the prosecutor in said case before he was a judge, called to tell me that there was a contract on my life. Yeah, another good story.

  • [Avatar for step back]
    step back
    September 3, 2019 12:07 pm

    Broken @2, well said.

    One needs to understand that stock options (i.e. for Theranos or other IPOs) are merely claims/promises of alleged success in the future. Often there is no credible evidence that those promises will actually come true.

    People are so hungry for a get rich quick opportunity that they overlook the possibility that the whole thing is a scam.

    In hindsight we know that Bernie Madoff was a scam. Theranos was a scam. Enron was a scam. The list goes on and on.

    Is the PTO/ US patent system a scam?

  • [Avatar for Bruce Berman]
    Bruce Berman
    September 3, 2019 10:31 am

    The PTO is not the FDA. However, investors and various stakeholder need to know what a patent is and is not; what it says about an invention and what the invention at the point of patent issuance can actually do. The problem with Theranos/Holmes was saying it had effectively solved a complex diagnostic challenge before it really knew what the problem was.

  • [Avatar for MuTru]
    September 2, 2019 08:45 pm

    “believing that partial truths could become whole ones”

    Which partial truths are you referring to? Near as I can tell, it was 100% lies from start to end.

  • [Avatar for AnonExaminer]
    September 2, 2019 06:37 pm

    I’m an Examiner that worked on some of the Theranos applications. I interviewed Holmes in person on two occasions. I remember her deep voice back then which some say is fake. I never allowed any of her applications that I examined.

    One of the main problems I think with the U.S. patent system has is that the Patent Office assumes that Applicants are honest and that the devices that they are filling claims for actually exist and work as claimed. Should the PTO be more like the FDA and require that these devices actually work before patenting them?

  • [Avatar for Peter Christiansen]
    Peter Christiansen
    September 2, 2019 05:05 pm

    Not a single biotech and only one VC (who was Elizabeth Holmes childhood next door neighbor, was conned by Theranos.

  • [Avatar for Broken System]
    Broken System
    September 2, 2019 02:05 pm

    Well if she had those 200 patents, and they were of some value today a company like Google or Apple would just take her patents and drain her out in the courts like they are doing to inventors all across America. No one in their right mind would invest in someone’s IP in today’s patent environment. The AIA Act and the PTAB and rulings like Alice, Mayo, EBay, TC Heartland and the Oils case have cemented FAANG in holding their positions of dominance and not allow anyone the oppornity to compete. investing in new tech today is high risk and the percentage of failure is extreme. Accountability is something that has been wiped off the face of America’s DNA. Bankers cheat and run away with millions, politician create fake wars and are not accountable as they are run by corporations. Theranos CEO is only a by product of a system that has been running wild that needs to come back to the rule of law. Every democrate and republican must be removed from special interest dollars and all citizens must be included regardless of sex, race, colour or social status. As America continues to destroy Main Street and pad their pockets off of FAANG. Asia and Europe continue to strengthen their laws and protect all their citizens and inventors from patent theft and crooked CEO that avoid the rules of law because the laws do not apply to billionaires.

  • [Avatar for step back]
    step back
    September 2, 2019 01:29 pm

    And the Alice/Mayo mantra is …

    “Fake it till you break it.”

    Break the US patent system that is. There is no more “there there” in Alice/Mayo then there was in the Theranos Edison machine. They are both built on deception and charlatanism.

    The Supremes are on equal par with Elizabeth when they come to intellectualize that isolating a DNA fragment is gee-whiz, just like plucking a leaf off a tree.

    Real inventing is hard hard work with many dead ends and disappointments. Destroying inventors is a simpleton’s task. Yes Virginia, everything is obvious and abstract; just like taking the pieces of an invisible puzzle and snapping them together according to their known functions to thus form a fine mesh befit for an Emperor to wear on his next royal parade.