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Tag: Legal proceedin

  • Elizabeth Holmes faces judgment day for her Theranos crimes

    Elizabeth Holmes faces judgment day for her Theranos crimes

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    SAN JOSE, Calif. — A federal judge on Friday will decide whether disgraced Theranos CEO Elizabeth Holmes should serve a lengthy prison sentence for duping investors and endangering patients while peddling a bogus blood-testing technology.

    Holmes’ sentencing in the same San Jose, California, courtroom where she was convicted on four counts of investor fraud and conspiracy in January marks a climactic moment in a saga that has been dissected in an HBO documentary and an award-winning Hulu TV series about her meteoric rise and mortifying downfall.

    U.S. District Judge Edward Davila will take center stage as he weighs the federal government’s recommendation to send Holmes, 38, to federal prison for 15 years. That’s slightly less than the maximum sentence of 20 years she could face, but far longer than her legal team’s attempt to limit her incarceration to no more than 18 months, preferably served in home confinement.

    Her lawyers have argued that Holmes deserves more lenient treatment as a well-meaning entrepreneur who is now a devoted mother with another child on the way. Their arguments were supported by more than 130 letters submitted by family, friends and former colleagues praising Holmes.

    A probation report also submitted to Davila recommended a nine=year prison sentence for Holmes.

    Prosecutors also want Holmes to pay $804 million in restitution. The amount covers most of the nearly $1 billion that Holmes raised from a list of sophisticated investors that included software magnate Larry Ellison, media mogul Rupert Murdoch, and the Walton family behind Walmart.

    While wooing investors, Holmes leveraged a high-powered Theranos board that included former U.S. Defense Secretary James Mattis, who testified against her during her trial, and two former U.S. Secretaries of State, Henry Kissinger and the late George Shultz, whose son submitted a statement blasting Holmes for concocting a scheme that played Shultz “for the fool.”

    Davila’s judgment – and Holmes’ reporting date for a potential stint in prison — could be affected by the former entrepreneur’s second pregnancy in two years. After giving birth to a son shortly before her trial started last year, Holmes became pregnant at some point while free on bail this year.

    Although her lawyers didn’t mention the pregnancy in a 82-page memo submitted to Davila last week, the pregnancy was confirmed in a letter from her current partner, William “Billy” Evans, that urged the judge to be merciful.

    In that 12-page letter, which included pictures of Holmes doting on their 1-year-old son, Evans mentioned that Holmes participated in a Golden Gate Bridge swimming event earlier this year while pregnant. He also noted Holmes suffered through a case of COVID in August while pregnant. Evans didn’t disclose Holmes’ due date in his letter.

    Duncan Levin, a former federal prosecutor who is now a defense attorney, predicted that Davila’s sentencing decision won’t be swayed by the pregnancy, but expects the judge to allow her to remain free until after the baby is born.

    “She will be no more of a flight risk after she is sentenced that she was while awaiting sentencing,” Levin said. “We have to temper our sentences with some measure of humanity.”

    The pregnancy makes it more likely Davila will be criticized no matter what sentence he imposes, predicted Amanda Kramer, another former federal prosecutor.

    “There is a pretty healthy debate about what kind of sentence is needed to effect general deterrence to send a message to others who are thinking of crossing that line from sharp salesmanship into material misrepresentation,” Kramer said.

    Federal prosecutor Robert Leach emphatically declared Holmes deserves a severe punishment for engineering a scam that he described as one of the most egregious white-collar crimes ever committed in Silicon Valley. In a scathing 46-page memo, Leach told the judge he has an opportunity to send a message that curbs the hubris and hyperbole unleashed by the tech boom of the past decade.

    Holmes “preyed on hopes of her investors that a young, dynamic entrepreneur had changed healthcare,” Leach wrote. “And through her deceit, she attained spectacular fame, adoration, and billions of dollars of wealth.”

    Even though Holmes was acquitted by a jury on four counts of fraud and conspiracy tied to patients who took Theranos blood tests, Leach also asked Davila to factor in the health threats posed by Holmes’ conduct.

    Holmes’ lawyer Kevin Downey painted her as a selfless visionary who spent 14 years of her life trying to revolutionize health care with a technology that was supposed to be able to scan for hundreds of diseases and other aliments with just a few drops of blood.

    Although evidence submitted during her trial showed the tests produced wildly unreliable results that could have steered patients in the wrong direction, her lawyers asserted Holmes never stopped trying to perfect the technology until Theranos collapsed in 2018. They also pointed out that Holmes never sold any of her Theranos shares — a stake valued at $4.5 billion in 2014 when Holmes was being hailed as the next Steve Jobs on the covers of business magazines.

    Defending herself against criminal charges has left Holmes with “substantial debt from which she is unlikely to recover,” Downey wrote, suggesting that she is unlikely ever to pay any restitution that Davila might order as part of her sentence.

    “Holmes is not a danger to society,” Downey wrote.

    Downey also asked Davila to consider the alleged sexual and emotional abuse Holmes suffered while she was romantically with Ramesh “Sunny” Balwani, who became a Theranos investor, top executive and eventually an accomplice in her crimes. Balwani, 57, is scheduled to be sentenced Dec. 7 after being convicted in a July trial on 12 counts of fraud and conspiracy.

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  • Lawsuit accuses largest US meat producers of wage fixing

    Lawsuit accuses largest US meat producers of wage fixing

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    DENVER — Three meat plant workers have filed a federal lawsuit accusing 11 of the United States’ largest beef and pork producers of conspiring to depress wages and benefits.

    The lawsuit, filed in federal court in Denver on Friday, seeks class-action status and alleges the producers have worked together since at least 2014 to keep workers’ compensation lower than the market would allow, violating the Sherman Antitrust Act.

    It was brought by two meat plant workers from Iowa and one from Georgia but seeks to represent hundreds of thousands of other people who have worked in jobs from slaughtering to production at the companies’ collective 140 plants. Together the plants produce about 80% of the red meat sold to U.S. consumers, according to the lawsuit.

    The companies are JBS USA Food Company, Cargill Inc., Hormel Foods Corp., American Foods Group LLC, Triumph Foods LLC, Seaboard Foods LLC, National Beef Packing Co. LLC, Iowa Premium LLC, Smithfield Foods Inc., Agri Beef Co. and Perdue Farms Inc., along with some subsidiaries.

    Cargill denied any wrongdoing.

    “While we cannot comment with specificity during the pendency of litigation, Cargill sets compensation independently to ensure that it pays fair and competitive wages to employees in each of the company’s plants,” company spokesman Daniel Sullivan said.

    Perdue Farms spokesperson Andrea Staub declined to comment, saying the company does not discuss pending lawsuits. Smithfield spokesperson Jim Monroe said the company has not had a chance to review the allegations and had no comment at this time. Representatives of the other companies did not immediately return emails and telephone messages seeking comment Wednesday.

    Two consulting companies that allegedly helped the meat producers exchange compensation information are also named as defendants in the lawsuit, which was filed by lawyers from Hagens Berman.

    “Our firm has secured $195 million in the poultry processing industry for the same antitrust behavior. The meat industry’s gravy train ends here,” the law firm’s managing partner, Steve Berman, said in an announcement of the lawsuit on Wednesday.

    The lawsuit alleges that the meat producers had secret meetings to discuss wages and communicated about them surreptitiously to avoid having any written records of the conversations.

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  • Texas to execute man for killing mother nearly 20 years ago

    Texas to execute man for killing mother nearly 20 years ago

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    HOUSTON — A Texas inmate whose lawyers say has a history of mental illness is set to be executed Wednesday for killing his mother and burying her body in her backyard nearly 20 years ago.

    Tracy Beatty, 61, is scheduled to receive a lethal injection Wednesday evening at the state penitentiary in Huntsville. He was sentenced to death for strangling his mother, Carolyn Click, after they argued in her East Texas home in November 2003.

    Authorities say Beatty buried his 62-year-old mother’s body beside her mobile home in Whitehouse, about 115 miles (180 km) southeast of Dallas, and then spent her money on drugs and alcohol.

    The U.S. Supreme Court on Wednesday morning declined an appeal from Beatty’s lawyers to halt the execution. On Monday, the Texas Board of Pardons and Paroles unanimously declined to commute Beatty’s death sentence to a lesser penalty or to grant a six-month reprieve. Beatty has had three prior execution dates.

    His attorneys had argued he was being prevented from receiving a full examination to determine if he is intellectually disabled and possibly ineligible to be put to death. They had requested that state prison officials allow Beatty to be uncuffed during mental health evaluations by experts. The experts argue that having Beatty uncuffed during neurological and other tests is crucial to making an informed decision about intellectual disability and evaluating his mental health.

    In their Supreme Court petition, Beatty’s lawyers said one expert who examined the inmate determined that he was “clearly psychotic and has a complex paranoid delusional belief system” and that he lives in a “complex delusional world” where he believes there is a “vast conspiracy of correctional officers who … ‘torture’ him via a device in his ear so he can hear their menacing voices.”

    Citing security and liability concerns, the Texas Department of Criminal Justice put in place an informal policy last year that would require a court order to allow an inmate to be unshackled during an expert evaluation.

    Federal judges in East Texas and Houston and the 5th U.S. Circuit Court of Appeals in New Orleans previously ruled against Beatty’s request for an evaluation without handcuffs. The federal appeals court called Beatty’s request a “delay tactic.”

    U.S. District Judge Charles Eskridge in Houston last week questioned why Beatty’s lawyers had not raised any claim relating to his mental health during years of appeals, and said requiring handcuffs during such an evaluation is “quite simply, a rational security concern.”

    While the U.S. Supreme Court has prohibited the death penalty for individuals who are intellectually disabled, it has not barred such punishment for those with serious mental illness, according to the Death Penalty Information Center, a Washington, D.C.-based nonprofit that provides analysis and information on capital punishment.

    The Texas Legislature considered but did not pass a bill in 2019 that would have prohibited the death penalty for someone with severe mental illness.

    Beatty had a “volatile and combative relationship” with his mother, according to prosecutors. One neighbor, Lieanna Wilkerson, testified that Click told her Beatty had assaulted her several times before, including once when he had “beaten her so severely that he had left her for dead.” But Wilkerson said Click had still been excited to have Beatty move back in with her in October 2003 so they could mend their relationship.

    Mother and son argued daily, however, and Click asked Beatty twice to move out, including just before she was killed, according to testimony from Beatty’s 2004 trial.

    “Several times (Beatty) had said he just wanted to shut her up, that he just wanted to choke her and shut her up,” Wilkerson testified.

    If Beatty is executed, he would be the fourth inmate put to death this year in Texas and the 13th in the U.S. Texas’ last execution for this year is scheduled to take place next week.

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    Follow Juan A. Lozano on Twitter: https://twitter.com/juanlozano70

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  • EXPLAINER: Jurors weigh cost of Alex Jones’ Sandy Hook lies

    EXPLAINER: Jurors weigh cost of Alex Jones’ Sandy Hook lies

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    WATERBURY, Conn. — For a decade, the parents and siblings of people killed in the Sandy Hook Elementary School shooting have been tormented and harassed by people who believe the mass shooting was a hoax.

    How do you put a price tag on their suffering?

    That’s part of the task faced by a Connecticut jury that has been asked to decide how much Infowars host Alex Jones and his company should pay for spreading a conspiracy theory that the massacre never happened.

    The six jurors deliberated for less than an hour Thursday before breaking for the evening. Their work was set to resume Friday.

    Jones now acknowledges his conspiracy theories about the shooting were wrong, but says he isn’t to blame for the actions of people who harassed the families. His lawyers also say the 15 plaintiffs have exaggerated stories about being subjected to threats and abuse.

    Here are some questions and answers about the deliberations.

    COULD THE JURY DECIDE THAT WHAT JONES DID IS PROTECTED BY THE FIRST AMENDMENT?

    No. A judge has already ruled that Jones is liable for defamation, infliction of emotional distress, invasion of privacy and violating Connecticut’s unfair trade practices law. The jury’s job is to decide how much he owes for harming the people who sued him over his lies.

    HOW MUCH COULD JONES PAY?

    Jones, who lives in Austin, Texas, could be ordered to pay as little as $1 to each plaintiff or potentially hundreds of millions of dollars to them. The decision will be based on whether the jury determines the harm to the families was minimal or extensive.

    Christopher Mattei, a lawyer for the plaintiffs, said the jury should award the plaintiffs at least $550 million. Jones’ lawyer, Norm Pattis, says any damages awarded should be minimal.

    HOW DOES THE JURY COME UP WITH THE DOLLAR FIGURES?

    In her instructions to the jury, Judge Barbara Bellis said there are no mathematical formulas for determining dollar amounts. Jurors, she said, should use their life experiences and common sense to award damages that are “fair, just and reasonable.”

    The jury, however, heard evidence and testimony that Jones and his company, Free Speech Systems, made millions of dollars from selling nutritional supplements, survival gear and other items. A company representative testified it has made at least $100 million in the past decade.

    WHAT KIND OF DAMAGES ARE THE JURY CONSIDERING?

    Jurors could award both compensatory and punitive damages.

    Compensatory damages are often meant to reimburse people for actual costs such as medical bills and income loss, but they also include compensation for emotional distress than can reach into the millions of dollars.

    Punitive damages are meant to punish a person for their conduct. If the jury decides Jones should pay punitive damages, the judge would determine the amount.

    DOES CONNECTICUT CAP DAMAGES?

    No, and yes. The state does not limit compensatory damages, while punitive damages are limited in many cases to attorney’s fees and costs. So if the jury says Jones should pay punitive damages, he would potentially have to shell out hundreds of thousands of dollars for the Sandy Hook families’ lawyers’ costs.

    IS THIS THE FIRST TIME JONES HAS FACED A VERDICT LIKE THIS?

    No. At a similar trial in Texas in August, a jury ordered Jones to pay nearly $50 million to the parents of one of the children killed in the school shooting for pushing the hoax lie on his Infowars show.

    But legal experts say Jones probably won’t pay the full amount. In most civil cases, Texas law limits how much defendants have to pay in “exemplary,” or punitive, damages to twice the “economic damages” plus up to $750,000. But jurors are not told about this cap. Eye-popping verdicts are often hacked down by judges.

    A third trial in Texas involving the parents of another child slain at Sandy Hook is expected to begin near the end of the year.

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