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The AIH Transcript for September 28, 2018

Hosts: Carol Off and Jeff Douglas

Prologue

CAROL OFF: Hello, I'm Carol Off.

JEFF DOUGLAS: Good evening. I'm Jeff Douglas. This is As It Happens.

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JD: Tonight…

CO: Judge of character. The GOP has agreed to an FBI investigation of Brett Kavanaugh. But our guest needs no further confirmation that he should be confirmed.

JD: Everything Musk go. Supporters think Elon Musk can do no wrong. But the U.S. Securities and Exchange Commission believes he's done serious wrong and shouldn't be in charge of his — or any — company.

CO: Pulling rank. According to the story they're just innocent fitness instructors. But our guest’s investigation shows when the men accused of poisoning Sergei Skripal and his daughter is in fact a Russian colonel in military intelligence.

JD: Lodge a complaint. A notorious child murderer is moved from a prison to a healing lodge in Saskatchewan — and the chief of the land where that lodge sits says his people should have been consulted.

CO: Remaking waves. An expert on Vincent Van Gogh claims to be the first to really dive into the ways the Dutch artist's Starry Night was inspired by the Japanese artist Hokusai and his famous print The Great Wave.

JD: And…Chewing the scenery. A rare majestic white deer who usually dominates the landscape of a British Park is captured in a once in a lifetime photograph doing the one thing that could make it look undignified — sneezing. As It Happens: The Friday Edition. Radio that knows what it's like to go weak at the sneeze.

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Part 1: Kavanaugh supporter, Tesla lawsuit, Van Gogh researcher

Kavanaugh supporter

Guest: Suzette Martinez

JD: Judge Brett Kavanaugh's nomination to the Supreme Court will go ahead to a vote on the Senate floor. But there is a caveat. The FBI will investigate the sexual assault claims against the judge first. The proposal was first floated by Republican Senator Jeff Flake today in a surprise move at the Senate Judiciary Committee. Hours earlier, Senator Flake was cornered in an elevator by survivors of sexual assault. Here's what that sounded like.

SOUNDCLIP

SURVIVOR: You’re telling all women that they don’t matter. That they should just stay quiet because if they tell you what happened to them you’re going to ignore them. That's what happened to me and that's what you're telling all women in America, that they don't matter, that they should just keep it to themselves because if they have told the truth you’re just going to help that man to power anyway. That’s what you’re telling all of these women. That’s what you’re telling me right now. Look at me when I’m talking to you. You’re telling me that my assault doesn’t matter. That what happened to me doesn’t matter. And that you’re going to let people that do these things into power. That’s what you’re telling me when you vote for him. Don’t look away from me. Look at me and tell that it doesn’t matter what happened to me. That you’ll let people like that go into the highest court of the land and tell everyone what they can do to their bodies.

JD: After that confrontation the Senate Judiciary Committee gathered to send Judge Kavanaugh's nomination to the full Senate for a vote. But at the last minute Senator Flake proposed something slightly different. Move the vote to the Senate floor, but order the FBI to investigate accusations of sexual assault against Judge Brett Kavanaugh first. At first there was confusion. Here is what the committee hearing sounded like.

SOUNDCLIP

JEFF FLAKE: Just wait just one second, can Dianne speak?

DIANNE FEINSTEIN: Could we have a description?

CHUCK GRASSLEY: We are voting on the motion to report the nomination to the floor.

CHUCK GRASSLEY: Senator I want to make sure because this is unprecedented and I do agree with a senator from Arizona that we should have this further investigation. So my understanding is during the week that that is taking place there will be no action on the floor of the United States Senate.

JF: Let me say again, I'm not making I can't make that commitment for the leadership. I can only say I'll move it out of committee but I will only be comfortable moving on the floor until the FBI has done more investigation than they have already.

JD: The Senate committee voted 11 to 10 to send to Judge Kavanaugh's nomination to the Senate floor while the FBI investigates. Here is what Senator Flake said in explaining his proposal.

SOUNDCLIP

JF: The Democrats who have been, I think, justifiably uncomfortable moving ahead. I'm not expecting them to vote ‘yes’ but not to complain that an FBI investigation has not occurred. That's what I'm trying to do, this country is being ripped apart here and we've got to make sure that we do due diligence. I think this committee has done a good job, but I do think that we can have a short pause and make sure that the FBI can investigate.

JD: Republican Senator Jeff Flake explaining his proposal this afternoon. Suzette Martinez is a Republican strategist and a supporter of Judge Brett Kavanaugh. We reached her in L.A.

CO: Ms. Martinez, did you want to see Brett Kavanaugh approved by this Senate committee today?

SUZETTE MARTINEZ: Yes I did. From the Judiciary Committee, yes I did.

CO: And there was nothing that happened yesterday that shakes your confidence that he is the man who should be going to the Supreme Court?

SM: Not necessarily. I think that this is a very serious matter that both parties deeply care about. So I think that in the spirit of American due process, I like the senator's recommendation for further FBI investigation. Now I have a husband, I have a father, I have brothers — I believe in the American justice process and political process. And I believe that individuals are innocent until proven guilty. And I don't — from my moral values and my political values — could never, would never want to convict a man and destroy a man's life based on an accusation that doesn't have any true evidence or corraboration.

CO: So just to go back to what you saw yesterday. Christine Blasey Ford, under oath, describes what happened to her — horrific details — we don't need to repeat them people are just numb by that. And she says with absolute, 100 per cent certainty that the man who did this to her was Brett Kavanaugh at the time that he was a teenager. Did that not mean anything?

SM: I believe that that's her truth. And I believe her story. And I could see it on her face that that is her truth. But I could also see it on Judge Kavanaugh’s us say that that is his truth. I don't think that believing both of their stories is mutually exclusive. I believe that there are additional facts that we may never know that actually paint the truth of the matter. But I don't think we'll ever know the truth of the matter. So we have to take a look at our moral values, at our system's values, and apply them to the situation.

CO: I just wonder — different truths. I mean, do you believe that it's possible, if not likely, that Brett Kavanaugh was in a room with Christine Blasey Ford at the time as she describes it. Do you think that that that happened or could have happened?

SM: Anything is possible.

CO: Did that happen? Because it's just — I know the realm of possibilities are huge but…

SM: If I knew the answer to that I'd be making a lot more money right now. We're going to have America's experts in the FBI hopefully investigating this and I don't know that they're going to come up with the answer to that.

CO: But what about her 100 per cent conviction. She has this locked in her memory that this is the man who was doing this to her. You don't forget something like that, do you?

SM: I understand and completely believe that that is het 100 per cent truth.

CO: What about Judge Cavanaugh's truth? I mean you have no questions about that? How he handled himself? How he answered questions yesterday?

SM: You know, how he answered questions I was trying to put into context, you know, trying to put aside the emotions of previous testimony and trying to look at how — if my husband were in that situation, if my father were in that situation. How would he react? And honestly, I saw my husband. I saw my father, who were angry. They were sad. He was in disbelief, mostly angry at what was going on. And I can understand that. I definitely noticed and saw that he was more comfortable and more authoritative and she was definitely more authentic and genuine in her story. But to me, that didn't signify that he was guilty. On the flip side, it made me believe that he was telling the truth.

CO: But wait a second. Okay, let's talk about the one area, which is whether he can remember this correctly. She remembers and she tells how she can remember because it gets locked in your brain. Many questions to Judge Kavanaugh yesterday were around his drinking habits as a young man and his admission in different times that he was a heavy drinker, and that the questions of whether or not he actually blacked out sometimes. And the issue here — the question is whether he — because she said he was stumbling drunk when he did this to her. Is it possible that he may not remember with any clarity something that she remembers completely if he was that fall-down drunk?

SM: I think it is absolutely possible and that is where I believe 100 per cent that they believe in their truths in their testimony and in their stories.

CO: If that's his truth, that this didn't happen is it it didn't happen because he has no recollection because he was too drunk to remember?

SM: That could be or it didn't happen. Maybe, you know, the recollection could have been that it was somebody else or he wasn't there. There are so many hypotheticals in this scenario and this situation and we’re at the highest process of the American system of appointing and confirming a new justice. And we can't base this — we can't throw away our values and our process as Americans by automatically assuming this man is guilty when there's no evidence.

CO: But we don't know. You just said yourself it's possible that it happened that he doesn't remember. You trust him you have confidence that what he remembers…

SM: Both of their testimonies are compelling.

CO: Do you want this man to be the Supreme Court justice? To have a life time appointment where he's making decisions that will affect the lives of millions of people? Based on what you saw and heard yesterday in the past days as we've learn this story, do you want that man to be in the Supreme Court?

SM: The man — based on the evidence, on the facts that I know about this man, yes. If there was even that slimmest bit of evidence I would say, you know, there is reasonable doubt to me. And let's find somebody better.

CO: What about the other women? What about Deborah Ramirez? What about Julie Swetnick? What about those who have sworn affidavits that she was part of these kinds of behaviour?

SM: I haven't heard any credible additional information from other women to make a statement on that.

CO: If nothing else, how hobbled is Mr. Kavanaugh, Judge Kavanaugh as a Supreme Court Justice, given that half the people in your country will picture him with his hand over the mouth of a 15-year-old girl keeping her from screaming? I mean, that's the image that's lodged in the brain, isn't it? How can you go before him and think you're going to get an honest judgment when we see that when we think of him?

SM: Right. You know, this is a smudge, and I feel really bad for him that this is going to be how people recall him — at least for the next couple of years. I’ve seen both sides.

CO: There has to be one truth in the end though, doesn't there? I mean, this isn't everybody's truth — everyone doesn't have their own truth. Something happened in a room 30 years ago.

SM: There is two sides and then the truth, right?

CO: But something happened in a room 30 years ago. And that is what is at stake now for this appointment. Something happened in room 30 years ago. And we have to know what happened there.

SM: Our political and judicial processes are at stake just as much. And then what does it say, you know, I remember learning about being innocent until proven guilty when I was in elementary school. That’s a pillar of our system too. Do we just throw that out the door?

CO: Is it more important to you to see Judge Kavanaugh become a member of the Supreme Court than to see it discovered whether or not this crime actually happened?

SM: It's more important to me to uphold American values. Our justice system, our separation of powers and our due process. That's what I'm putting my faith in.

CO: How divided is your country given that half the people see this man as being someone who sexually assaulted a woman?

SM: It’s as divided as it's ever been.

CO: All right. We'll be watching. Ms. Martinez, I appreciate speaking with you. Thank you.

SM: Of course. Thank you so much.

JD: Suzette Martinez is a Republican strategist who is standing by the Supreme Court nominee Brett Kavanaugh. We reached Ms. Martinez in Los Angeles.

[Music: Ambient Beeps]

Tesla lawsuit

Guest: Michael Liftik

JD: Tesla CEO Elon Musk has been known to send out some pretty attention grabbing tweets. Among them, the one he sent back in August when he wrote quote “Am considering taking Tesla private at $420 funding secured,” unquote. That one got the attention of U.S. Securities and Exchange Commission and now the SEC has charged Mr. Musk with securities fraud because of what it calls false and misleading tweets. And the commission is so unimpressed with Mr. Musk that it says it is seeking to bar him from quote “serving as an officer or director of a public company.” Mr. Musk says the suit is an unjustified action. Michael Liftik is a lawyer who used to work for the SEC. We reached Mr. Liftik in Washington, D.C.

CO: Mr. Liftik, why is this tweet from Elon Musk such a big deal in the eyes of the SEC?

MICHAEL LIFTIK: It's a big deal because any time a public company CEO speaks to the market they have an obligation to speak truthfully and completely. And the issue with his tweet was particularly a couple of words there that say ‘funding secured’ the SEC now alleges that that was not the case and he knew that it was not the case.

CO: And what were the results of him putting out that tweet?

ML: Well, when he put out that tweet people took it at face value that in fact he had an intention to take Tesla private. That would have an effect on the stock price and, in fact it, did have an effect on the stock price it went up dramatically that day. So investors clearly believe that that information that Tesla was potentially going private was incredibly important to them and they reacted to it by buying the stock.

CO: And just kind of précis that what he had to say — what Mr. Musk said, he said that funding for the transaction had been secured and that the only remaining uncertainty was a shareholder vote. Was any of this true?

ML: Well, according to the SEC complaint virtually none of it was true. They walk through all of the ways in which that statement was false. What they allege is that while he may have had a 30 to 45 minute meeting with the International Sovereign Wealth Fund, they never discussed price. The conversation was very vague. There were other hurdles before any deal could take place. There were no terms. He had no advisers, they hadn't agreed on any kind of a structure. He hadn't approached the board of directors. So, not only to give a firm price that $420 dollars a share, but also to say the only barrier was the shareholder vote makes it sound like it's all done, papered, wrapped up and ready to go when, in fact, that was not the case.

CO: Any consideration for the fact that this is his kind of style, that Elon Musk is this kind of dramatic, that he does make sweeping gestures of this kind? It's just part of his his sort of his M.O. his theater, so it's done him well in many respects. Any consideration this is his how he does business?

ML: Well, I think there is a line. And while certain people may be more charismatic or aggressive in the way they use social media, this case sends a strong message that no matter who you are or how you use Twitter or other social media, if you speak to the market you must speak truthfully. And here the SEC clearly believes that he was not speaking truthfully. And in the public company arena that's a very serious obligation. And your personality and your approach, it just isn't going to be an excuse.

CO: Where did the price — $420 a share come from? Do you know.

ML: Well, there was a lot of speculation when it first came out. I believe the SEC complaint alleges that he essentially made it up, that he thought that it was that a 20 per cent premium was standard for private equity deals. And so he simply took 20 per cent off of where the stock was trading at the time as a premium and then rounded it up to $420 apparently admittedly because it has some meaning in the marijuana culture.

CO: Good heavens. And that ties into the bizarre scene of him actually smoking during an interview. Did that that come up at all?

ML: You know, that's not a part of the SEC’s allegations, but I would imagine that Mr. Musk’s subsequent behaviour certainly focused the minds of the regulators investigating it — that there is some erratic behavior coming out of his office and that's something that could be concerning and I would imagine would be concerning to the board of directors as well.

CO: What are the consequences for Elon Musk if this is successful?

ML: Well, the consequences could be quite severe. The SEC has sought what's called an officer and director bar where a court would deny him the privilege of being either an officer or a director of a public company. He would have to step down from the chairmanship of the board of Tesla. He could no longer be CEO, but that would apply to any public company. So it's quite a severe sanction if the SEC were to win its case and a judge were to impose that relief.

CO: CNBC is reporting today that Mr. Musk backed out of a deal at the last minute with the SEC. Why do you think he did that?

ML: We don't know what the breaking point was in terms of their discussions, but I certainly wouldn't be surprised to learn that it had to do something with the scope of an officer or director bar. That's a very severe remedy and you wouldn't expect somebody like Mr. Musk to take that type of a sanction without litigating for a while.

CO: If it turns out that he is barred from serving as an officer or director of a public company — as the SEC is saying, threatening it might do — what happens to Tesla without Elon Musk as the leader?

ML: I think that's a that's a great question, and I think something of significant concern to shareholders. He actually could stay on as an employee. He could stay as a head of innovation or head of product design or some such title, he just can't be an office director, so it's certainly possible for him to stay and bring his creativity and energy to the company. You would just need different officers. Whether that would be acceptable to shareholders, whether he can continue to make the company innovative in a way that adds value to shareholders is an open question I think.

CO: We’ll leave it there. Mr. Liftik, thank you.

ML: Thank you.

JD :Michael Liftik is a former SEC enforcement lawyer. We reached him in Washington D.C. In a statement, Mr. Musk said quote “I have always taken action in the best interests of truth, transparency and investors. Integrity is the most important value in my life. And the facts will show I never compromised this in any way” unquote.

[Music: Guitar Plucks

Van Gogh researcher

Guest: Martin Bailey

JD: They are two world-renowned artworks of natural phenomena created 60 years apart by artists 10,000 kilometres apart. I'm talking about the woodblock print The Great Wave by Japanese artist Hokusai, and the painting Starry Night by the Dutch post-impressionist Vincent Van Gogh or Van Gogh — as he is commonly known. There are two images so famous and so frequently reproduced that you can probably picture them if you can close your eyes. If you're driving don't do that. If you are picturing them you can probably see the similarities. People have speculated about a link between the works before. But now a Van Gogh expert has researched the connection more deeply. Martin Bailey is an author and an investigative reporter for The Art Newspaper. We reached him in London.

CO: Mr. Bailey, as you know, these are two extremely famous images. Just start off by describing them side-by-side. Just remind people what these two paintings are.

MARTIN BAILEY: Yes, they are very famous. I mean, let's start off with The Great Wave, which is almost certainly the most important Japanese work of art. As the title suggests, the main point of the print is this huge wave which sort of rears up and it's just about to break and fall over. And if you look at the print more carefully you can spot three very small fishing boats and also in the distance Mount Fuji. But it's a wave which really dominates the picture. The the Van Gogh painting Starry Night is probably even more famous. The most important element of the picture is, of course, the night sky with a yellowy-orange moon and about a dozen very, very bright stars or planets. But the most interesting feature of the painting, which really brings it to life, is a sort of wave like feature which sort of rushes across the painting in the middle. And that really gives a dynamism to the composition. So we have two great works of art there.

CO: We know of Van Gogh was very inspired by Japanese art, these Japanese block prints all the impressionists at the time were so interested in these beautiful works and they were sharing them and passing them around. What do you know, in your research what have you found as to how — what did Van Gogh say about the wave and his knowledge of it?

MB: Yes, I mean, there's a lovely quote in one of his letters and he says Hokusai’s waves are claws, the boat is caught in them, you can feel it. And if you look at the Hokusai print the wave which is about to break over and turn into foam is exactly like claws. So it's very well expressed. And it's interesting, Van Gogh, when he wrote that letter, he didn't actually have the print, he'd seen it in Paris a few months earlier but he obviously remembered it very vividly. And he was a great admirer of Hokusai and indeed of Japanese prints in general. And astonishingly over 500 of Van Gogh’s Japanese prints in his collection still survive and they're at the Van Gogh Museum. And that's evidence of quite how much he liked their art and it had a great influence on his paintings — particularly in his last years when he was doing some of his greatest work.

CO: In fact, a number of self-portraits and interiors he did where he lived you can see the block prints on the walls, he includes them in the paintings, doesn’t he?

MB: They were something which always annoyed his landlords as you can imagine. Wherever he went he put up prints and in his later years they were often Japanese prints. And you know looking at them today they're very dramatic, almost exotic. But in Van Gogh’s day the colours must have appeared so strong and they must have appeared so different from conventional European art. So it was really quite an avant-garde thing during his time.

CO: We know that Starry Night was painted by Van Gough when he was quite ill. It was after he had cut his ear off. He was in an asylum, wasn't he, for the mentally ill in Provence. Did he have this with him when he when he was painting Starry Night?

MB: He did not have the print originally. When he wrote the letter he didn't have the print but Van Gogh probably got it a few weeks later because Theo, his brother, sent him a consignment of prints. The print doesn't survive in his collection but that doesn't necessarily mean anything because it was a very valuable — it became a very valuable print and it could have well being given or sold during the early 20th century. Van Gogh had a very strong visual memory. So if he'd seen something months ago he could still remember it and it was an inspiration in his mind when he was working on Starry Night.

CO: Is that, I mean, you've seen how — the similarities, but have people not made this link before? I mean, there are many things written and discussed about the influence of Japanese art on the Impressionists and especially Van Gogh. Hasn't this been pointed out before that there is similarities?

MB: Well, astonishingly it appears not. I mean, I can't say that it's never been said but having read the Van Gogh literature, there don't seem to be any references comparing the two works. I mean, I was immediately struck when I saw the Hokusai print — and I've discussed it with a number of Hokusai experts and they had also not heard of a comparison. So I think it's a fresh idea. I mean, it's impossible to prove that there's an influence because one is very unlikely to ever find hard evidence. But looking at the two work side-by-side I think one must conclude that it's highly likely that The Great Wave played a role in influencing Van Gogh when he did his Starry Night. Of course Van Gogh, he worked from his imagination. He wasn't a simple artist and there were all sorts of things that would come together in his mind. So I'm not suggesting it's the main motive for doing the picture, but I think it is an inspiration. If one's looking for the main reason why he did the picture, I think he would look up into the heavens and he would see the stars and that was really what inspired him most of all to do this wonderful work of art.

CO: Always good to be reminded of this wonderful art by Van Gogh, and I appreciate you telling us about it Mr. Bailey, thank you.

MB: Many thanks, Carol. All the best.

CO: Thank you.

JD: Martin Bailey is a Van Gogh specialist and an investigative reporter for The Art Newspaper. We reached him in London. We have more on the story on our website: www.cbc.ca/aih.

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Part 2: Russian colonel, Healing lodge chief

Russian colonel

Guest: Christo Grozev

JD: According to an interview on Russia's RT, they were just a couple of guys in the fitness industry who traveled to Salisbury, England because they wanted to check out a church. But the government the UK believes their trip had a nefarious purpose. It has said the men went to Salisbury to poison former Russian spy Sergei Skripal and his daughter Yulia. And now an investigative website by the name of Bellingcat says it has been able to track down the real identity of one of the men. And according to Bellingcat’s research he is a decorated Russian military intelligence officer. Christo Grozev is a researcher who led Bellincat’s investigation. We reached him in Vienna.

CO: Mr. Grozev, when we saw this RT interview, one of the men introduced himself as Ruslan Boshirov. What have you discovered is his real name?

CHRISTO GROZEV: His name is Anatoliy Chepiga. He's off by one year from the personality that he presented in terms of age, and he is off by many, many other qualities from the personality we saw on RT.

CO: You sound very confident. How do you know that this is Colonel Chepiga?

CG: Well, we've identified him by many, many objective and subjective metrics. First of all, objectively, we got a hold of his original passport files. So we've seen the actual passport database with his date of birth, original photo taken when he was 17 and another one when he got his first passport and another one taken when he was 21. And after we were ready with the report and the identification, we actually contacted sources of the British police and secret services to just get a nod not a nod as to our findings — and we got the nod. So we know for sure that that's the one.

CO: You also dug into the file of Colonel Chepiga. What can you — he was much decorated servicemen. He has received Russia's highest state award. What do you know about him?

CG: Well, he was born in a tiny village of a population of less than 300 people in the farthest corner of the Russian Federation. He went to a military school that was only about 30 miles away from his home village. At that time in the late 90s and early 2000s was one of the most elite or let's say better staffed schools for military education. So he got his military education in a special operations unit — training unit that the school. Immediately thereafter he was sent to actually service in Chechnya. He went to three deployments in Chechnya where he amassed a number of awards because apparently he was great at what he did as a soldier. And then he was — as a very promising soldier who had accumulated about 15 awards already — he was sent to GRU school and GRU school in Moscow is one of the — it's called the Academy — The Diplomatic Academy, but, in fact, it's a spy school and it's the most elite spy school in Russia.

CO: And now it sounds like you have a lot of information. This is mostly from open sources, you didn't go on the ground to seek this out. You did this from a distance and — working for your website Bellincat, which has been accused by the Russian government of being a front for Western intelligence agencies, that you're fabricating evidence. Why should we trust your conclusions here?

CG: Well, all of our findings in the past have either been proven right or Russia has stopped trying to rebut them because they have no way to rebut them. What we do is very transparent. You can, I mean, almost anybody with analytical skills can go and replicate that data. We don't point people to where they can get the leaked Russian databases — but they're out there. They're on the Internet and they're in torrents and anybody who spends a week will be able to get them and then replicates our findings.

CO: But a number of things have left people scratching their heads about your conclusion. I think you're scratching your head as well. Why a Colonel? Why would somebody of such a high rank and such a decorated man be sent on this mission to poison people in Great Britain, and also to be so exposed because you know that when you're in Great Britain there are a lot of cameras observing you? So why such a high-ranking man?

CG: Well, that's a mystery. We received opinions from two senior Russian officers, both of them said literally the same thing, we would have expected somebody with a rank of Major or even Captain to have done this. The fact that they chose a Colonel means that the order came at a very high level probably one layer below Putin, not Putin himself, but it's something that they did in order to show a result to show to Putin that actually they took all the measures and all the precautions to have the highest expertise on the ground, which apparently they didn't.

CO: And this is all around, of course, just to remind people the poisoning of Sergei and Yulia Skripal and also this British citizen Don Sturgis. We saw this this man who calls himself Ruslan Boshirov and his partner on television in this RT interview. They looked that goofs, didn't they. I mean, it was a farce. People here were laughing. Everyone was laughing — including people in Russia. So how is it that somebody of such high caliber, somebody who is so skilled, would first of all, be allowed to be on Russian TV to be so exposed and then to be such a goof?

CG: Well, that's another mystery. There are at least two hypotheses on this that circulate amongst informed circles. One is that they were given this order at the last moment after Putin made that blunder himself by saying well, we know they’re are civilians and I expect them to come and save themselves. Bear in mind that people like this are never prepared to go public and to be burnt in public. And this was a very embarrassing moment for them. Another hypothesis was that that was punishment for actually their blunder and their botched up job. I don't believe that that's realistic because whatever they were, there were not traitors. And in the Russian army the only people they punish really are traitors. And I think that if anything they would be demoted but not put on purpose to be embarrassed.

CO: Does it appear that this is just a botched operation? I mean, they were successful in reaching these people and poisoning them, but was this a failure?

CG: Well, I think now it has become a failure. Even the Russians, the average Russian who believe that, if nothing else, Russia is good at spying and not exposing its spies — now realize that they're not good at that either. If you look at the old Internet memes that spread on the Internet — the Russian Internet — before they were making fun of the West, of America, of the opposition. Now Russians are making fun of their own intelligence services. And that's unprecedented. And I think that is a failure for the regime.

CO: Okay, we'll leave it there. Mr. Grozev, thank you.

CG: Thanks. Bye-bye.

JD: Christo Grozev is a researcher at the investigative website Bellingcat. We reached him in Vienna.

[Music: Ambient Bass]

Jeopardy proposal

JD: If you are keeping track of these things — and you definitely should be — we have now had public marriage proposals via ‘kiss cam’ at the Emmys award ceremony and now on America's favourite quiz show — Jeopardy. Now however you feel about exposing your raw, beseeching heart in front of thousands, likely millions, of people — you do have to give points to this recent contestant at least for chutzpah. Here is Jeopardy host Alex Trebek during last night's episode.

SOUNDCLIP

ALEX TREBEK: Okay. Now ladies and gentlemen normally when I interview the contestants I base my conversation on little bits of information they have supplied us. But with regard to Michael Pascuzzi from Orlando, Florida I have absolutely nothing on the card. So what do you want to talk about?

MICHAEL PASCUZZI: I can fill in for you. I just wanted to say one quick thing and ask Maria Shafer, right there.

AT: Who is Maria, where is she? Oh, hello Maria.

MP: If she would make me a winner today and marry me.

[APPLAUSE]

MP Will you marry me?

MARIA SHAFER: Yes. Of course.

AT: Maria, you responded too quickly. I was about to say, ‘We'll have the answer to that question right after this commercial break.’

MS: That would be, what is yes.

[APPLAUSE]

JD: Of course, Alex Trebek, contestant Michael Pascuzzi and his new fiance Maria Shafer.

[Music: 90’s Hip-Hop]

Healing lodge chief

Guest: Chief Alvin Francis

JD: Prior to this week you may not have heard of the Okimaw Ohci Healing Lodge in Saskatchewan. Then came reports that Terri-Lynne McClintic was moved there from a federal prison. Now there is national outrage and the Federal Government has asked for a review of that transfer because Ms. McClintic is a convicted child-killer, who was found guilty of murdering 8 year old Tori Stafford in 2010. Alvin Francis has said he was shocked when he heard the news of the move because the healing lodge where Ms. McClintic has been staying is on his land. He is the chief of the Nekaneet First Nation. We reached Chief Francis in Regina.

CO: Chief Francis, how did you come to learn that Terri-Lynne McClintic was living in your community?

CHIEF ALVIN FRANCIS: I actually got a call from our vice chief. She said that for me that the media were asking her questions and it was a shock to learn that she was one of our, I guess, inmates.

CO: What interactions had she had with people in the community at that point?

AF: Well, see this past — I do believe it was sometime in the middle of August — we actually had some ceremonies on the First Nation, and the girls from there they all participate in these ceremonies that they request.

CO: And so when you learned that she was there and you learned — you knew who she was — how did you react?

AF: I was actually quite shocked that she was there because that name it just stuck out in my memory for some reason it just came to me. And I went ‘Oh, wow. That’s not really a good thing.’ But I have to believe that Corrections Canada has done their due diligence in interviewing her in the interview process of her bringing her to Okimaw Ohci Healing Lodge.

CO: And that's what they're saying, the Correctional Services of Canada and Commissioner Anne Kelly has said that they had a quote “rigorous case management process” and they're reviewing it but they feel confident of that. Do you feel confident of their choice?

AF: I have to believe that Corrections Canada is doing their job because a number of years ago when we had our elders involved in the process of interviewing people to come to our lodge, they made that choice for us. And since that program was cut we don't have a say anymore.

CO: What does that mean for you, that you don't have a say anymore, that you don't — you can't even don't even know who is living with you?

AF: Well, that's the thing. See, when I first got in as Chief I had requested that program be reinstated.

CO: And then what happened?

AF: Just basically government procedures again, that my request will be listened to and they'll take it up the ladder of Corrections Canada, and that's all I was given.

CO: How different is the relationship between the Okimaw Ohci Healing Lodge with your community and other corrections facilities?

AF: The difference is that we actually have elders programming there and that teaches many different, I guess, different tribes teachings but it's mostly based on ours — on Nekaneet, the Cree culture and that's the big difference there is that we’re quite involved with the ladies there at the lodge.

CO: Just to remind people. And I'll just warn our listeners that it's disturbing what we know about the crime of Terri-Lynne McClintic — but she lured an 8-year-old girl, Tori Stafford, into a car with her boyfriend where she was sexually assaulted and then she was murdered. Are there other inmates like that, are there other women at the healing lodge who are have been convicted of crimes on that scale?

AF: Well, I really couldn't comment on that because we were actually not privy to that information when somebody comes to the healing lodge. Because being the Chief, yes, they do tell me, ‘Okay, now we have three more coming this month or four more coming this month.’ That is all the information that we are given.

CO: So you would not know of someone who had been convicted of crimes on this scale was among the women who were at the lodge?

AF: No.

CO: And what do you and the elders — I mean, not just you but those elders who — the women who are helping out, who are trying to assist this healing. What are they saying about this discovery?

AF: Well, see that's the other part of the coin here. They actually have to keep that confidential. They can't actually bring it out and tell the community ‘Okay, we have this person that person there.’ They can't do that.

CO: Can you describe the security arrangement at the healing lodge?

AF: The security arrangements. There are no fences. They have secured living conditions. They have to let them out at a certain time, they have to be back in their living quarters at a certain time and they're locked in. You know, but they're let out at a certain time too, right.

CO: But there is a barrier and cameras surveillance to keep them on the grounds, is there not?

AF: Yes, there is — there's a lot of it.

CO: So it's not like people can come and go? It's a minimum security facility like you would find elsewhere.

AF: It's minimum to medium because they do have places where if somebody gets upset they do have a lockdown.

CO: It's also supposed to be for Indigenous people, is it not?

AF: It is supposed to be, yes, when it was first started. But then when, I guess, when women applied for our healing lodge they went through a lot of process of being interviewed and whether or not they're willing to accept our teachings as being one of their ways of learning how to deal with themselves and whether or not they're willing to change for the better of Canadian society.

CO: At the same time, just point out Ms. McClintic apparently self-identifies as Aboriginal. Does that satisfy you?

AF: I really couldn't tell you. Sure anybody can self-identify as a First Nations person because, I mean, as far as I know even in the town of Maple Creek, I have people there who are 1/16 First Nation. They still self-identify themselves as First Nations.

CO: What do you say to Tori Stafford’s family, her mom and dad who…

AF: My heart goes out to them because that is — that crime is horrendous. That's the way it's got to be seen, right. I mean, I have those personal feelings too. But I can’t — I'm not within corrections to tell them what to do. My job is to ensure that my people are safe and as long as — if there was ever a time that they felt unsafe I'm pretty sure that my people that work there would come and tell me. And I have only been here for 18 months and I was a councillor before for three years and this matter has never but been brought up before of somebody feeling unsafe there.

CO: All right we'll leave it there. Chief Francis, thank you.

AF: Okay, thank you.

CO: Bye-bye.

JD: Chief Alvin Francis is chief of the Nekaneet First Nation. We reached him in Regina.

[Music: Trance Bass]

White deer sneeze

JD: Here we see an astonishing sight, the rare white to fallow buck in repose in a British park. Even more astonishing, we see it at the precise moment it issues its haunting call, which echoes majestically across the landscape.

SOUNDCLIP

SNEEZE

JD: Obviously that was not a male fallow deer call — it was a sneeze. A human sneeze to be totally transparent. But in our defense, no one has ever recorded the sneeze of a white fallow buck — this whole situation is astonishingly unprecedented. In the words of Oban van Schie, a one-in-a-million shot. Well, recently Mr. van Schie was in Bradgate Park in Leicestershire, England with a camera. It was not a surprise to see the deer. The park has been home to herds of red and fallow deer for almost 800 years. But the regal white buck with its glorious spreading antlers, sitting peacefully upon the ground — that was a surprise. Oban van Schie told the BBC he was able to get within ten metres of the buck without disturbing the rest of the herd. And he took a series of photographs, one after another. He knew he had some special images, but he had no idea how special until he got home and he went through them. And that's when he realized not only had he captured a rare creature, he had captured that rare creature at the precise split-second it sneezed. Not exactly fair, is it? This white buck spends years as the most magnificent deer in the park. And this by biped immortalizes him in the one hundredth of a second when he looks absolutely ridiculous. Not a photo it would want on its driver's license, but from a human perspective, it is one-in-a-million shot of a regal, usually silent animal, momentarily exploding. An even bigger bang from your buck.

[Music: Waltz]

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Part 3: The fall of Theranos (encore broadcast)

The fall of Theranos (encore broadcast)

Guest: John Carreyrou.

JD: Elizabeth Holmes was once the darling of Silicon Valley. Now she has a cautionary tale. And her once multibillion dollar company Theranos is no more. As you may have heard on this program the reportedly ground-breaking blood test technology that Ms. Holmes created didn't work as promised, and she worked extremely hard to hide that fact. Eventually however, her company was exposed in a series of articles by investigative journalist John Carreyrou in the Wall Street Journal. Mr. Carreyrou later published a book entitled Bad Blood: Secrets and Lies in a Silicon Valley Start-up. Back in May, Carrol spoke with Mr. Carreyrou about the stunning fall of Theranos. Since that conversation Ms. Holmes has been charged with multiple counts of fraud and faces the possibility of 20 years in prison. Earlier this month, the acting CEO of Theranos announced that attempts to sell the company had failed and it was being shut down. Here is an encore presentation of Carol's conversation with John Carreyrou.

CO: John, welcome to As It Happens.

JOHN CARREYROU: Thank you for having me.

CO: Can you just start off by telling us what was the pitch that this company, Theranos, was making to the world?

JC: Right. Theranos was a company that was founded by a Stanford dropout named Elizabeth Holmes, and she claimed to have invented a portable device that could run the full range of lab tests off just a drop or two of blood pricked from the finger.

CO: And what would that be to replace? Why would that be something that the world would want?

JC: And in addition to being able to run the full range of tests from just a drop of blood from the finger she said — her pitch was that she could get the results very quickly at half or less of the prices that other laboratories offered. It would have been a great advance because, as you know, when you get your blood drawn usually they'll take several tubes — often as many as five tubes and they'll use the big hypodermic needle and a lot of people find that process unpleasant and avoid getting their blood drawn. And sometimes diseases and conditions get missed because people aren't getting their blood drawn and having lab tests as often as they should.

CO: And the company went even further to suggest that some point this could be something you have in your home like your thermometer, you could just do have your own blood tests, get yourself diagnosed and send a message to your doctor and you have a cure or some medication waiting for you.

JC: That's right. When she first dropped out of Stanford in 2003, Holmes had this idea for what she called a Thera-patch. It was sort of an arm band that had micro needles and the micro needles would draw your blood from your wrist and simultaneously diagnose whatever was ailing you and inject you with the appropriate drug. That vision proved a bit too futuristic and naive. So she quickly pivoted to something that she thought was more feasible, which was a cartridge and reader device. The reader was sort of like toaster-sized and it was a system that you could have in your home. And she idolized Steve Jobs and Apple and she wanted the Theranos blood testing device to eventually be in everyone's home and be ubiquitous just like Apple devices —iPhones and iPads and iPods.

CO: She, this Stanford dropout Elizabeth Holmes — absolute compelling personality. Her face many people have seen gracing the covers of all the big magazines and business publications. Who is she?

JC: She is — well now she's about 34 years old, at the time when she dropped out of Stanford, she was 19. She had barely completed a-year-and-a-half of her undergraduate studies. So she had no training to speak of in medicine or really in science but she was very ambitious. From an early age she wanted to be a successful entrepreneur. Like I said, she idolized Steve Jobs, and by sheer force of will and hard work she convinced a lot of people to fund her, and over the years developed three iterations of a Theranos blood testing device. And by the time she rolled out her blood test commercially in Walgreen’s stores and in the fall of 2013, she was now 30 years old and she became an instant star. And, like you said, graced the covers of Fortune Magazine, was profiled in The New Yorker, became a fixture at conferences and on television and her company in its last round of funding garnered a valuation of more than $9 billion. She had managed to keep half or more of the shares of her company so that effectively gave her a net worth four $4.5 billion dollars and made her the world's youngest female self-made billionaire.

CO: She modeled herself on Steve Jobs, as you mentioned. How did she do that?

JC: Well, she started wearing a black turtleneck around 2006. And, of course, that was the trademark outfit that Steve Jobs made famous. She also liked to drive around in a car without license plates, which is something that Steve Jobs also did. She implemented in Theranos a culture of absolute secrecy and that was also in part because it's something that that Apple was famous for. She had hired Chiat/Day, the advertising firm, and she hired them because they had worked on some famous Apple advertising campaigns. So really the mythology of Steve Jobs and of Apple really was there throughout her 12-year rise. It really was an obsession.

CO: But that magic, that sort of cult of personality that she created, attracted a lot of high profile, very impressive people. I'm looking at how you describe her board of directors — George Shultz, Henry Kissinger, Secretary of Defense James Mathis. How did she manage to bring all those people into her orbit?

JC: You're right. Her board was filled with larger than life personalities, legendary former statesmen like Secretary of State George Shultz, who crafted the Reagan administration's foreign policy and is credited by many with defeating the Soviet Union and ending the Cold War. How did she get all these people on her board? Well, she was introduced to George Shultz by someone at Stanford in 2011 and George Shultz is someone who has always been very passionate about science. And he was won over by Elizabeth's vision and her charisma and he quickly joined her board. And after that he introduced her to many of his colleagues at the Hoover Institution, which is the conservative think tank that is headquartered right on the Stanford campus. And that's how she was able to meet Henry Kissinger and people like Sam Nunn and Bill Frist and Admiral Roughead and all of these people gradually became Theranos directors and she lured them with grants of stock. Of course the stock at one point was worth a lot of money because Theranos reached a valuation of almost $10 billion.

CO: You are listening to As It Happens. I have John Carreyrou in the New York studio. Ee're talking about his fascinating book Bad Blood: Secrets and Lies in a Silicon Valley Startup. John, your book — well first your articles that you wrote for The Wall Street Journal and then ultimately this book — you begin with an anecdote about the company's onetime chief financial officer Henry Mosley. What did he discover about the early Theranos system that began to tweak his curiosity and his concerns?

JC: Right. In November of 2006, So Theranos by then was about a 3-year-old company, he started getting a sense that a demonstration that Elizabeth had given to Novartis, the giant Swiss drug maker, had not gone well because employees who had acompanied Elizabeth on the demo looked outright downcast when they got back to Palo Alto. So he started asking questions and eventually that day Elizabeth Holmes’ co-founder a person by the name of Shaunak Roy, who had worked with Elizabeth in the Stanford professor Channing Robertson's Lab at Stanford, came clean to the CFO that actually the demos weren't entirely real, that the result that they showed prospective investors who came by for the demos were pre-recorded because the system didn't always work and, in fact, often malfunctioned. And so they had recorded one result and that's what they showed. And he realized at that point that he had been bringing around investors for months and that they were being misled. And so he confronted Elizabeth that day in her office and told her ‘We need to stop misleading investors. We need to stop doing these demos if they're not totally real.’ And at that point she turned icy and told him that he was not a team player and fired him on the spot.

CO: He only knew that because he was he hearing it from people in the company that he was building this case. Others were hearing it or suspecting. What did you hear from other employees about what their suspicions were and why they didn't raise the alarm?

JC: Right, well the history of Theranos is one — and by the way we're now 15 years into it — is a history of tremendous turnover. Elizabeth fired people all the time. And you also had along the way quite a few people who left because they had qualms. The problem was that Theranos made everyone sign non-disclosure agreements and there was an unspoken and sometimes even spoken threat of litigation if anyone spoke up. So that's how the secret that this company was a house of cards got kept for so long. And when the company eventually commercialized its blood tests in the fall of 2013, even one of Theranos’ directors grandsons, who was working at the company at the time — and that was none other than Tyler Schultz, the grandson of the former Secretary of State George Shultz — tried to raise his concerns internally with Elizabeth and her boyfriend Sunny Balwani, who was the number two at the company, and he was rebuffed and threatened and he had to leave the company quietly. And I later made contact with Tyler about a year later and he was one of the whistleblowers who helped me expose the scandal.

CO: But as you point out, I mean, Silicon Valley is full of young people, idealistic people who see themselves above capitalism. They're trying to change the world. They think they're on a mission. It's a very zealous place. And so how come nobody blew the whistle? How come those who have little bits and pieces of this — some had larger pieces than others — why did they never expose Elizabeth Holmes?

JC: Well, this was a company that had an almost $10 billion valuation that raised almost a billion dollars from investors. It had very deep pockets. Its CEO and the COO were very intimidating and threatening, and it was very well known that they would not hesitate to go after employees who spoke up. And those threats were backed up in the person of David Boies, who is arguably America's most famous lawyer. He was the outside counsel for the company starting in 2011, eventually came to become a de facto board member in 2013 attending all the board meetings of the company. David Boies was a scarecrow that put the fear of God in many employees. They felt that if they were to go public with their concerns that David Boies and his henchmen would come after them.

CO: There's one man that you talk about, a scientist Ian Gibbons, a very a sad case of somebody who was working with Elizabeth Holmes had his concerns and died. Can you tell us about him and what happened to him?

JC: So Ian was probably the first legitimate scientist that Elizabeth hired in 2005 and he helped Theranos develop its blood tests. He had worked at several diagnostics companies over the years and Theranos is a company that he joined when he was in his late 50s. So he was at toward the end of his career and he eventually developed qualms because he realized that the diagnostic boxes that Theranos was working on were not reliable. And he also came to distrust Elizabeth and felt she was dishonest and he was also, at one point, demoted because he tried to blow the whistle on the way she was running the company to his old friend Channing Robertson, the Stanford professor who had helped Elizabeth launch her company and who was her mentor. And Channing Robertson told Elizabeth everything Ian had said, so in 2010 Elizabeth fired Ian. He was rehired the next day because a lot of his colleagues lobbied Elizabeth to rehire him, but he wasn't hired in the same capacity, he was effectively demoted. And so that blow to his pride in his career triggered the beginning of a depression, along with the fact that the company was claiming things about its systems capabilities that he felt weren't true. And eventually his depression got worse and worse and unfortunately, he committed suicide in the spring of 2013.

CO: And his widow was a very good source for you, telling you what it was like — what had been like for Ian Gibbons to be working for Theranos and for Elizabeth Holmes. What did she tell you?

JC: So I met her for the first time in the early summer of 2015, a few months before my first story came out, and she was still very much grieving Ian. I met her at a restaurant in Palo Alto and she had tears in her eyes and she felt that none of this would have happened if Ian had not worked at Theranos. She didn't know the particulars of the technological problems that Theranos was having because Ian had been prevented from going into that with her because of the NDA he had signed. But she knew, because he had told her so, that things weren't working, that the technology wasn't working. She also knew that the culture, the corporate culture at Theranos was one of fear, paranoia and secrecy.

CO: Despite such tragedies and despite all the people who had their doubts and concerned this company kept on and the though the technology was certainly not up to snuff Theranos managed to partner with the U.S. drugstore chain Walgreens. What was the deal? What did they partner to do in the Walgreen chain?

JC: Right. So the idea was they were going to do a pilot launch first in about 45 stores, a couple in California and the rest in the Phoenix area, and then they were going to expand Theranos’ finger stick blood testing services to all of Walgreens stores, which meant expanding to more than 8,000 stores through the U.S. And Theranos services would be offered in these wellness centres within the Walgreens stores. And Walgreens customers would go in and get their fingers pricked and then get results, supposedly within a half-hour and at a fraction of the prices of traditional laboratories.

CO: And did it work for anybody?

JC: Well, behind the scenes what was actually happening is Theranos was using one of its devices, the Edison, which was the second to last iteration of its technology, for only a few finger stick tests, between a half dozen and a dozen. And the rest of the more than 240 blood tests on its menus were actually performed on modified Siemens machines. So the Siemens machines were hacked by Theranos employees and modified so that they could accommodate tiny fingers stick samples and they did that mostly by diluting the blood samples to create more volume so that the Siemens machines could accommodate those samples. But, of course, diluting the blood created problems because the blood as part of the Siemens machines protocol would already get diluted within the Siemens machine. So this meant an additional pre-dilution step. And when you're diluting blood twice you're tampering with the sample and creating more room for error. The other problem was that when you were pre-diluting the blood you were taking the concentration of the analytes in the blood you were trying to measure down to levels that were below the allowed measurement range for these Siemens machines. So it was essentially an unauthorized experiment and Siemens itself didn't even know that Theranos was doing this with its machines and regulators certainly didn't either. And this resulted in inaccurate results and the results that were performed — that were obtained from the Edison for the few tests that the Edison put out, were also inaccurate because those machines were unreliable. So in the end Theranos had to void or correct almost a million blood test results in Arizona and California.

CO: And were people harmed by this? Did they get misdiagnosed and have any consequences?

JC: It's really difficult to measure the harm, but I certainly came across more than a dozen instances of patients who got questionable test results back from Theranos and had health scares or had unnecessary medical treatments. Some patients have banded together in a putative class action in federal court in Arizona alleging that Theranos committed consumer fraud and medical battery. And one of those consumers who sued alleges that a Theranos blood test failed to detect his heart disease. And that as a result the heart attack that he subsequently suffered, could have been, and was not prevented.

CO: You are listening to my conversation with John Carreyrou, who is the author of Bad Blood: Secrets and Lies in Silicon Valley. And you're listening to As It Happens. John, you began to investigate, you approached Theranos to find out what they're up to. This is late summer and fall of 2015. How did Theranos react when they knew that you were questioning the system and what they were selling?

JC: I actually approached them — or they approached me they found out that I was talking to a lot of people and so they hired a an outside PR person to approach me in late April of 2015 and I would say that for the first two months the company gave me the runaround. I think that it hoped that I would just go away and in the meantime Elizabeth kept giving interviews to magazines and making appearances on TV, it seemed like I was the only reporter in America that she wouldn't talk to. So I finally told the PR person that they had to address my questions, that we had to meet and they couldn't just ignore me. So what did the company do at that point? It sent lawyers led by David Boies to the midtown Manhattan newsroom of The Wall Street Journal. And Boies and these lawyers met with us for five hours in June of 2015 and were threatening and told us that I had misappropriated Theranos trade secrets, that had to essentially cease and desist and either destroy them or return them. And it was made very clear to us that if we proceeded with the story we would be sued. Over the ensuing weeks Theranos was able to figure out who some of my sources were, including Tyler Schultz's identity, and went and threatened these sources and, I'm convinced, had them surveiled by private investigators. And one of the most shocking episodes is described in the book in chapter 20 of the book, is the ordeal that the company and David Boies’ his law firm put Tyler Schultz through.

CO: At some point Elizabeth Holmes had to actually address her staff — what she thought of these articles you were writing, your publications — how she was going to defend it. Do you know what happened when she actually addressed the staff?

JC: Yes, when the first story that I wrote came out she was in Boston. So she did an interview on CNBC’s Mad Money program, in which she essentially denied my article, and then flew back to California the next day held an all-employee meeting in the cafeteria of Theranos’ Palo Alto headquarters and told employees that the story was inaccurate and false and seeded by disgruntled employees and competitors and said that she would take on the Wall Street Journal and the reporter. Toward the end of that meeting Sunny Balwani, who is number two at the company and Elizabeth's boyfriend, led employees in an “F You” chant. They were saying “F you, Carreyrou.”

CO: So have you ever seen it get personal like that before in your investigations?

JC: I've been doing this for more than 20 years and I've certainly experienced instances where there was pushback but never anything of this scale. I mean, having sources followed and intimidated and having essentially a scorched earth campaign waged against me, my newspaper and my sources, is something that I had not experienced before.

CO: How did the Wall Street Journal respond to this? Because there was one issue that came up you learned, that well Rupert Murdoch, who owns the Wall Street Journal, was actually an investor of Theranos.

JC: Right. And I actually didn't know that before we published my first story. I heard rumors and I only got confirmation that Rupert Murdoch had invested in Theranos a year after my first story was published in October of 2016, at which point we found out that his investment was actually enormous. He had been the single biggest investor in Theranos. He had put a $125 million dollars in the company. And it was quite a surprise and a shock for me when I learned that.

CO: Elizabeth Holmes attempted to pressure him to shut down your investigation?

JC: Right. And I learned that subsequently when I went on book leave, I learned that she met with him four times before my first story was published, including once in his office on the eighth floor of the News Corp building just two weeks before my story was published and I was on the fifth floor just three floors below. And I had no idea she was in the building.

CO: Elizabeth Holmes has said that she was — in response to all this — she's devastated by deficiencies in her lab and she has settled with the Securities and Exchange Commission in the U.S. on charges of overseeing massive fraud. But has Elizabeth Holmes ever admitted she did anything wrong?

JC: Never. She did use the word devastated, but she didn't admit to having done anything wrong and she never apologized to the patients that she put in harm's way or to investors for that matter.

CO: Have you ever had a chance to interview her?

JC: Never. I tried to interview her for five-and-a-half months before my first story was published. I went back and sought interviews again over the next two, three years, including for the book, and she never agreed to speak to me.

CO: And your book isn't just about her — it's principally about her and this company — but it's also about Silicon Valley and its culture and this sort of cult of personality that exists there. How everything has a bit of a bit of fairy dust on top of it that people follow that very, very important people, smart people will go into investments with seems like, with their eyes half shut. So what do you make of that? What did you earn about the culture of Silicon Valley in the course of the investigation?

JC: There's a lot of innovation, for sure, going on in Silicon Valley, but there's also a lot of pretending, there's a lot of hubris and arrogance and Theranos was a story of fraud but also of hubris and arrogance. And the front man — or front woman rather — for the fraud was Elizabeth and she had this incredible charisma. She was also very smart and she had this ability to make people suspend disbelief. As I said, her idol was Steve Jobs, and she shared with Steve Jobs this trait, which was that she had a reality distortion field. She's able to cast a spell on people and to really get them excited and enamored with the vision that she's articulating, to the point where they forget to ask, ‘Are you really able to do this?’ ‘And if you are, can you walk me through how exactly it works and how you were able to solve these problems that thousands of researchers in academia and industry have been unable to solve for the past 20 years?’

CO: But if you hadn't done your investigation, if your investigative nose hadn't twitched at some point, I mean, a lot of people were invested in this — a lot of agencies that should have been on top of this, a lot of levels government that should have been alerted. This isn't like making an app for something that's just going to make your life more fun. This would affect people's health. How do you think it was able to bypass so many checks?

JC: Well, I mean, some parts of this story are almost incomprehensible. How did Walgreens, Theranos’ main retail partner, not do sufficient due diligence and figure out that the Theranos device was but a malfunctioning prototype? Walgreens actually hired a consultant very early on. His name is Kevin Hunter and he sniffed out that things were not right during visits at Theranos in Palo Alto and also during meetings that the two companies had. And he tried to warn people at Walgreens that this was going to end badly and Elizabeth and Sunny Balwani were able to get him marginalized by telling Walgreens that they didn't want him to participate in the weekly video conference calls and that they didn't want him to be in the in-person meetings anymore. And so he continued to work for Walgreens, but he was held at arm's length and not allowed to do his job. As far as the regulators are concerned, Elizabeth Theranos exploited a loophole between two agencies. And Elizabeth was able to capitalize on that ‘no man's land.’

CO: John it’s a remarkable story and I’m glad that you could — the Wall Street Journal gave you the ability to do this kind of investigation, very important. And thank you for speaking with us.

JC: Thank you so much for having me.

JD: John Carreyrou is an investigative reporter for The Wall Street Journal and the author of Bad Blood: Secrets and Lies in a Silicon Valley Start-up. And this has been an encore presentation of his conversation with Carol from our studio in New York, which we first aired back in May. This month the acting CEO of Theranos announced the company will be shut down. You can find that interview on our website: www.cbc.ca/aih.

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Sept. 28, 2018 episode transcript

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