🗞️ Riot Settles To Change Course
🗞️ Riot Settles To Change Course
Appears in this episode
This Week: A verdict in the Elizabeth Holmes trial, Riot Games pays up, and New Yorkers rule on the opioid crisis. Plus, Airbnb finds a home in Cuba, and Chief Justice Roberts gives his annual report.
🩸A Start-Up Goes Down
How far can a CEO/Founder go in selling their vision? How rosy is too rosy a picture to paint? These questions were at the heart of the Elizabeth Holmes trial which reached a verdict after four-months of testimony and some 50 hours of jury deliberation. Holmes was found guilty on 4 counts: 3 for wire fraud and 1 for conspiracy to commit wire fraud. The former CEO of Theranos may face a maximum sentence of 20 years per count, though likely less.
Holmes founded biotech start-up Theranos when she was 19, and attracted such investors as the Walton family, the Coxes, Henry Kissinger, and others with her "famously charismatic" personality, notes NPR.
The 4 counts Holmes was found guilty of involved very large investors including Brian Grossman.
No date has been set yet for Holmes's sentencing, and her business partner, Sunny Balwani, faces his own trial in the coming weeks.
The Valley's Reckoning?
Will this change how Silicon Valley operates? "When Silicon Valley entrepreneurs tell tales about their vision for changing the world, so long as they really are talking about something that is a vision, they’re going to continue, I think, to be OK in a criminal sense," Adam Lashinsky told Marketplace. "If they lie about something that’s going on right now, that’s where they’re going to get into trouble. That’s what happened to Elizabeth Holmes."
The Verdict
Holmes will very likely appeal the verdict and her legal saga will continue. Meanwhile, the DOJ could retry her on counts that the jury remained hung on. Whatever the final result, it sure feels like Silicon Valley is breathing a sigh of relief rather than learning any lessons.
🎮 Riot Settles To Change Course
Over 2,300 female employees and contractors of Riot Games will receive a $100 million settlement from the League of Legends maker following a class action lawsuit claiming systemic sexism and sexual harassment at the company. In 2018, video game publication Kotaku revealed a toxic culture of discriminatory hiring and promoting practices along with widespread sexual harassment in the workplace. Riot initially settled the ensuing class action suit for $10 million in 2019, but the California Department of Fair Employment and Housing (DFEH) and Division of Labor Standards Enforcement (DLSE) blocked the settlement saying a larger sum could be agreed to.
According to The Verge, Riot's new settlement includes terms beyond monetary compensation greater pay transparency and several years of third-party monitoring.
The Bigger Picture
As Riot settles and pledges to change its ways, fellow video game giant Activision Blizzard is embroiled in a similar sexual harassment scandal. Beyond these cases, the entire gaming industry has been grappling with a deeply toxic culture among employees and players alike. A widely publicized incident in 2014 dubbed GamerGate first brought the issue to light, but the industry has been slow to address it.
The Verdict
For an industry that raked in over $85 billion in 2021, while Riot alone made nearly $2 billion in 2020, settlements of the million-dollar variety then dragged over multiple years won't get the attention of corporate leadership—who are the ones that can ultimately change things.
🏛️ New York Says Guilty
Count it another win for those trying to hold Big Pharma accountable. A jury in suburban Suffolk County, New York, has found Teva Pharmaceuticals guilty of public nuisance for its role in the ongoing opioid crisis. The case was made by the state against several pharmaceutical firms, but all except Teva settled out of court for a combined total of $1.5 billion.
According to the suit, Teva manufactured two generic brands of fentanyl pills that it then pushed in a "deceptive and dangerous marketing strategy," notes NPR.
Following the guilty verdict, Letitia James, New York State's attorney general, announced that her office will begin seeking monetary damages from Teva immediately.
"The plaintiffs presented no evidence of medically unnecessary prescriptions, suspicious or diverted orders, no evidence of oversupply" Teva said in a statement after the verdict.
A Winning Strategy
This case is one of thousands across the country attempting to hold pharmaceutical makers responsible for the opioid crisis that has killed at least 500,000 Americans over the last two decades. However, it is only the second time that the Public Nuisance strategy has ended with a conviction.
The Verdict
Two guilty verdicts from two separate juries gives hope to the "public nuisance" strategy. And though billions in settlements is no substitute for the lives lost, it may help bring an end to the opioid crisis.
📤 What Else We're Forwarding
Cuba Libre: Airbnb has reached a settlement with the Treasury Department over violations of US sanctions against Cuba, reports the Wall Street Journal. Airbnb launched its service on the Caribbean island back in 2015, but claims it’s no longer able to manage sanction risks.
Roberts Report: At the end of a rather unprecedented year for the SCOTUS, Chief Justice Roberts is calling for judicial independence, says Law.com. The Chief Justice further promised a focus on judicial ethics in his annual report.
🎧 Music We’re Working To
Today we’re listening to Miles Davis, an American trumpeter, bandleader, and composer. One of the most influential names in Jazz, Miles Davis struck boundaries by meandering through various stylistic developments of his five-decade career. Released on July 30, 1969, In A Silent Way represents his first recording experimenting with electric instruments, and kicks off his fusion period. It features extensive overdubbing, and tape manipulation that layers improvisations by Davis and his sideman. The whole album was recorded in one session on February 18th, 1969.
In A Silent Way - Miles Davis (40m, no vocals)
Spotify / Apple Music / YouTube Music / Amazon Music
How would you rate this week’s newsletter? 🤔
• Legend • Great • Good • OK • Meh
See ya next week!
✌🏽 Raad