May 30, 2017

Court documents show lack of response from Theranos board


At least two former members of Theranos's board of directors didn't look into the blood-testing company's technology, even after news reports raised raised significant questions, According to newly unsealed court documents obtained by the Wall Street Journal.

Former U.S. Navy Adm. Gary Roughead and former U.S. Secretary of State George Shultz said in March depositions that they believed Theranos was performing all of its tests using proprietary technology. The depositions were part of a lawsuit by Theranos investor Partner Fund Management, which was settled on May 1. As of March 20, the company hadn't commissioned an outside probe into allegations about Theranos's technology and that it misled investors.

Why it matters: The depositions support criticism that Theranos didn't have enough medical experts on its original board, something unusual for a company developing blood-testing technology (though it later added a medical advisory board). It also raises questions about whether Theranos's board fully performed its duties to keep the company in check.

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