Martensen IP Blog

The Rise and Fall of Theranos: Clarifying Important IP Concepts | Martensen IP Law

Written by Martensen IP | February 7, 2022

Martensen IP’s Barbara Courtney is an intellectual property (IP) attorney and former engineer with more than 20 years of experience in Silicon Valley. She works with public and private companies to develop IP portfolios, from the stage of identifying and protecting innovation to assertion of IP assets and defense of IP assertions from others.

In an insightful article, “What Happened at Theranos and How Does That Impact the Perception of Intellectual Property?”, she examines the fraud trial of Elizabeth Holmes, founder and former CEO of Theranos, Inc. The company claimed to have revolutionized the blood testing industry with a product that could perform thousands of analyses on a single drop of blood almost instantly.

Fraud and Finger-Pointing

Theranos’ meteoric rise and catastrophic collapse garnered a great deal of media coverage. While IP was not a central focus of the recent federal fraud trial, it was referred to often in misleading and confusing ways. The trial prompted much finger-pointing. For example, commentators have questioned the role that the U.S. Patent and Trademark Office (USPTO) system, the venture capital industry, and Silicon Valley culture played in allowing this fraud to be perpetrated.

IP became a subject of scrutiny, in part, because Holmes used claims that the Theranos blood-analyzing machine’s functioning was a trade secret to hide the fact that the device didn’t actually work. Theranos also filed more than 200 patent applications.

Trade Secret Protection and Patent Protection: What Are They and Why Are They Usually Mutually Exclusive?

Barbara’s article uses Holmes’ trial as the backdrop for providing important information on trade secrets and patents for any company concerned about protecting its IP. She also uses the events that led to the trial as a cautionary tale, stating that, “The Theranos case provides an opportunity for those who participate in any aspect of IP acquisition and exploitation to better understand what IP is and is not. It also provides encouragement to perform their due diligence with the help of experts at every step of the process.”

Read Barbara Courtney’s Article on Elizabeth Holmes, Theranos and IP Protection

Anyone who is interested in intellectual property and how to properly protect it will find valuable food for thought in Barbara’s article. Download a free copy today.