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In the Elizabeth Holmes criminal case, the media is also on trial – CNN



(CNN Business)For a time, Elizabeth Holmes was a media darling. The college dropout who started her blood-testing company Theranos at 19 graced the cover of magazines such as Forbes, Fortune, and Inc. in her signature black turtleneck to help cultivate her image as “the next Steve Jobs.” She was upheld as a rare female founder who’d raised significant sums of capital to drive her startup towards an eye-popping $9 billion valuation.

Seemingly everyone was fascinated by the young entrepreneur seeking to revolutionize blood testing and who managed to attract a who’s who of powerful men to buy into her lofty mission.
Now, Holmes’ criminal case is underway in a San Jose federal court where her relationship with the media is also on trial.
Holmes, who has pleaded not guilty, faces a dozen counts of federal fraud and conspiracy charges, and up to 20 years in prison over allegations that she knowingly misled doctors, patients and investors in order to take their money. Part of the alleged scheme? That she and her ex-boyfriend, Ramesh “Sunny” Balwani — who served as Theranos’ chief operating officer — leveraged the media in their efforts to defraud investors. (Balwani faces the same charges, has pleaded not guilty and is set to be tried after Holmes’ case concludes.)
In the government’s opening statements, lead prosecutor Robert Leach called attention to Holmes’ role in using the media and positive press coverage to propel her company and attract investors. “The defendant’s fraudulent scheme made her a billionaire. The scheme brought her fame, it brought her honor, and it brought her adoration,” Leach said.
The government alleged that Holmes even approved a 2013 piece by a Wall Street Journal opinion writer prior to its publication that offered a glowing look at Holmes and Theranos, but also contained misleading claims of the company’s capabilities at the time. The article corresponded with a broader unveiling of the startup after years of operating in stealth and was leveraged by Holmes as external validation of the company.
In a statement to CNN Business, Journal spokesperson Steve Severinghaus said, “editors make publishing decisions based on their independent judgment.”
The statement continued, “Our writer asked Elizabeth Holmes to confirm complicated facts on a technical subject, not to approve publication. Our writer visited Theranos, spoke with numerous sources in and outside the company about its technology, and had his blood tested on a Theranos machine that appeared to offer credible results. If that was all a deception, then the responsibility lies with Ms. Holmes and Theranos.”
In his testimony Wednesday, retired four star general and former Secretary of Defense James Mattis, who served as a board member and invested $85,000 into the startup, shed light on the level of control Holmes asserted over what was revealed to reporters. Mattis testified that he asked what he was at liberty to share before speaking to the New Yorker’s Ken Auletta, who profiled Holmes in December 2014. Holmes responded to Mattis in an email, shown in the courtroom, with a list of three topics she said the company didn’t talk about on the record, including “How our technology works (ie that there is a single device that does all tests).”
“I thought we had been kind of out front that there’s a single device and why would we want to hide that,” Mattis testified Wednesday, while also noting that it “didn’t bother me because I didn’t consider myself a technological expert, and I wasn’t going to talk about something I wasn’t an expert in anyway.” (Mattis is not directly mentioned in the New Yorker article.)
It was Auletta’s article that ultimately led then-Wall Street Journal reporter John Carreyrou to start digging. Carreyrou’s investigative reporting would uncover significant flaws in the company’s technology and capabilities that contradicted claims made by Holmes and Theranos. His work prompted broader scrutiny into the company leading to its eventual demise. Carreyrou also wrote a critically-acclaimed book “Bad Blood: Secrets and Lies in a Silicon Valley Startup” based on his reporting.
In the course of his own reporting, Auletta pressed Holmes on her claims — particularly that Theranos was sharing data with the Food and Drug Administration. Holmes grew frustrated, according to audio recording of Auletta’s interview of Holmes that aired on the latest episode of Carreyrou’s podcast covering the trial. “You’re getting into an area that’s privileged,” she told Auletta.

“For the media to become part of the story, that’s less common”

The media both helped build up Holmes and Theranos and then played an important role in revealing what was really happening at the company, Margaret O’Mara, a historian of the tech industry and professor at University of Washington, told CNN Business in an interview this month. Holmes arrived on the scene as a rare female founder claiming to be “doing big things, changing the world … at a time when Silicon Valley is starting to get heat — rightly so — for not having many women at the top.” O’Mara said it was a storyline that Holmes leaned into.
According to Miriam Baer, a law professor at Brooklyn Law School, corporate fraud cases can often involve a charismatic actor who tells a compelling narrative. “It is not unheard of or infrequent for the media to discover fraud,” she told CNN Business. “But for the media to become part of the fraud — or part of the story, if you will — that’s less common.”
Holmes’ interactions with reporters may be put front-and-center if journalist Roger Parloff, a possible government witness, takes the stand. Parloff wrote the Fortune Magazine cover story on Holmes and Theranos in June 2014 — the first of many favorable profiles. In Parloff’s own words, the feature “helped raise to prominence” Holmes, as he later detailed in a column more than a year later titled “How Theranos Misled Me.
“Roger was first [to the story] and felt a tremendous amount of guilt,” said Alex Gibney in 2019; Gibney is the prolific documentary filmmaker whose HBO film, “The Inventor,” chronicled the rise and fall of Theranos. Gibney, who has said his work began with interviewing journalists who felt duped, has called Parloff the “beating heart” of his film. (CNN and HBO share a parent company.)
While Parloff has turned over audio recordings and notes from his interviews with Holmes and Balwani as part of a grand jury subpoena order, he’s objected to a trial subpoena order by Holmes’ defense team, citing reporter’s privilege among other considerations.
According to a recent court filing, Holmes’ defense team is seeking to compel Parloff to comply with the order, asking that he be required to turn over notes and recordings from interviews he conducted with others for his story. This evidence, Holmes’ team believes, will serve to refute the claims that Holmes misled Parloff, and through him, investors. Holmes’ team has called for a hearing on the matter on or around October 6. (According to Baer, “a trial subpoena contains more hurdles to collecting information than there are under a grand jury subpoena,” adding that the outcome of the hearing “may well result in a much narrower field of documents that the reporter has to produce.”)
There’s also a chance Carreyrou will take the stand — with Holmes listing him among her potential witnesses. Carreyrou, in a tweet, said his name appearing on her possible witness list — along with three prosecutors and officials from the FDA and Centers for Medicare and Medicaid Services — indicate to him, “They’re going to argue to the jury that this was a witch hunt.”
In an interview ahead of the trial, Carreyrou said he’d “make a great witness for the prosecution and a terrible one for the defense,” noting that he’s “a bit concerned” about whether it would interfere with his ability to cover the trial through his podcast. He’s yet to be subpoenaed.

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Western News – Expert insights: Why social media companies need to be reined in – Western News



In September, the Wall Street Journal released the Facebook Files. Drawing on thousands of documents leaked by whistle blower and former employee Frances Haugen, the Facebook Files show that the company knows their practices harm young people, but fails to act, choosing corporate profit over public good.

The Facebook Files are damning for the company, which also owns Instagram and WhatsApp. However, it isn’t the only social media company that compromises young people’s internationally protected rights and well-being by prioritizing profits.

As researchers and experts on children’s rights, online privacy and equality and the online risks, harms and rewards that young people face, the news over the past few weeks didn’t surprise us.

Harvested personal data

Harvesting and commodifying personal data (including children’s data) underpins the internet financial model — a model that social psychologist and philosopher Shoshana Zuboff has dubbed surveillance capitalism .

Social media companies make money under this model by collecting, analyzing and selling the personal information of users. To increase the flow of this valuable data they work to engage more people, for more time, through more interactions.

Ultimately, the value in harvested personal data lies in the detailed personal profiles the data supports — profiles that are used to feed the algorithms that shape our newsfeeds, personalize our search results, help us get a job (or hinder) and determine the advertisements we receive.

In a self-reinforcing turn, these same data are used to shape our online environments to encourage disclosure of even more data — and the process repeats.

Surveillance capitalism

Recent research confirms that the deliberate design, algorithmic and policy choices made by social media companies (that lie at the heart of surveillance capitalism) directly expose young people to harmful content. However, the harms of surveillance capitalism extend well beyond this.

Our research in both Canada and the United Kingdom has repeatedly uncovered young people’s concern with how social media companies and policy-makers are failing them. Rather than respecting young people’s rights to expression, to be free from discrimination and to participate in decisions affecting themselves, social media companies monitor young people to bombard them with unsolicited content in service of corporate profits.

As a result, young people have often reported to us that they feel pressured to conform to stereotypical profiles used to steer their behaviour and shape their environment for profit.

For example, teen girls have told us that even though using Instagram and Snapchat created anxiety and insecurity about their bodies, they found it almost impossible to “switch off” the platforms. They also told us how the limited protection provided by default privacy settings leaves them vulnerable to unwanted “dick pics” and requests to send intimate images to men they don’t know.

Several girls and their parents told us that this can sometimes lead to extreme outcomes, including school refusal, self harm and, in a few cases, attempting suicide.

The surveillance capitalism financial model that underlies social media ensures that companies do everything they can to keep young people engaged.

Young people have told us that they want more freedom and control when using these spaces — so they are as public or private as they like, without fear of being monitored or profiled, or that their data are being farmed out to corporations.

Teenagers also told us how they rarely bother to report harmful content to the platforms. This isn’t because they don’t know how, but instead because they have learned from experience that it doesn’t help. Some platforms were too slow to respond, others didn’t respond at all and some said that what was reported didn’t breach community standards, so they weren’t willing to help.

Removing toxic content hurts the bottom line

These responses aren’t surprising. For years, we have known about the lack of resources to moderate content and deal with online harassment.

Haugen’s recent testimony at a Senate Committee on Commerce, Science and Transportation hearing and earlier reports about other social media platforms highlight an even deeper profit motivation. Profit depends on meaningful social engagement, and harmful, toxic and divisive content drives engagement.

Basically, removing toxic content would hurt the corporate bottom line.

Guiding principles that centre children’s rights

So, what should be done in light of the recent, though not unprecedented, revelations in the Facebook Files? The issues are undoubtedly complex, but we have come up with a list of guiding principles that centre children’s rights and prioritize what young people have told us about what they need:

  1. Young people must be directly engaged in the development of relevant policy.
  2. All related policy initiatives should be evaluated on an ongoing basis using a children’s rights assessment framework.
  3. Social media companies should be stopped from launching products for children and from collecting their data for profiling purposes.
  4. Governments should invest more resources into providing fast, free, easy-to-access informal responses and support for those targeted by online harms (learning from existing models like Australia’s eSafety Commissioner and Nova Scotia’s CyberScan unit).
  5. We need laws that ensure that social media companies are both transparent and accountable, especially when it comes to content moderation.
  6. Government agencies (including police) should enforce existing laws against hateful, sexually violent and harassing content. Thought should be given to expanding platform liability for provoking and perpetuating these kinds of content.
  7. Educational initiatives should prioritize familiarizing young people, the adults who support them and corporations with children’s rights, rather than focusing on a “safety” discourse that makes young people responsible for their own protection. This way, we can work together to disrupt the surveillance capitalism model that endangers them in the first place.The Conversation

Kaitlynn Mendes, Professor of Gender, Media and Sociology, Western University; Jacquelyn Burkell, Associate Professor, Information and Media Studies, Western University; Jane Bailey, Professor of Law and Co-Leader of The eQuality Project, L’Université d’Ottawa/University of Ottawa, and Valerie Steeves, Full Professor, Department of Criminology, L’Université d’Ottawa/University of Ottawa

This article is republished from The Conversation under a Creative Commons license. Read the original article.

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Trump Plans to Regain Social Media Presence With New Company – Bloomberg



Former President Donald Trump on Wednesday announced a deal that would enable him to regain a social media presence after he was kicked off Twitter Inc. and Facebook Inc. platforms. 

The former president’s new enterprise will be in operation by the first quarter of 2022, according to a press release from the Trump Media and Technology Group. It says it plans to start a social media company called Truth Social. The moves, if all goes according to plan, would occur well ahead of the 2022 mid-term elections. 

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Protesters denounce Netflix over Chappelle transgender comments



About 100 people protested near Netflix Inc’s headquarters on Wednesday against the streaming pioneer’s decision to release comedian Dave Chappelle’s new special, which they say ridicules transgender people.

Netflix staff members, transgender rights advocates and public officials gathered on a sidewalk outside a Netflix office blocks away from the company’s main 13-story Sunset Boulevard building in Los Angeles.

Demonstrators held signs proclaiming, “Trans Lives Matter” and “Team Trans” and chanted slogans like “What do we want? Accountability,” “When do we want it? Now.”

Netflix staff were outnumbered by members of the public, but the precise number was not clear. Netflix employees had called for a walkout.

Chief Content Officer Ted Sarandos acknowledged in interviews before the walkout, “I screwed up” in how he spoke to Netflix’s staff about Chappelle’s special, “The Closer.”

Sarandos previously defended the decision to air the show, saying Chappelle’s language did not cross the line into inciting violence. Netflix posted record subscriber numbers on Tuesday,

“While we appreciate the acknowledgement of the screw-up, in his own words, we want to actually talk about what that repair looks like,” said Ashlee Marie Preston, a transgender activist who came out in support of the Netflix employees.

Joey Soloway, creator of “Transparent,” a now-ended streaming series on rival Amazon that had a transgender character, talked about the line that separates edgy jokes and harmful speech.

“People say to me, as a comedian, where’s the line?” said Soloway. “The line is anything that makes it worse.”

Not everyone supported that message. “…The idea that a small, angry mob can shape entertainment and silence people’s speech is terrifying,” said counterprotester Dick Masterson.

While employee protests against corporate policies have become common in Silicon Valley, this is believed to be the first such action at the pioneer streaming video company.

The controversy over “The Closer” is playing out against the backdrop of a company-wide diversity effort that began in 2018, after Netflix’s former head of communications was fired for using a racial epithet in company meetings.

“It doesn’t feel good to have been working at the company that put that out there,” Netflix software engineer Terra Field wrote in a Medium post, referring to “The Closer.” “Especially when we’ve spent years building out the company’s policies and benefits so that it would be a great place for trans people to work.”

(Reporting by Dawn Chmielewski in Los Angeles; editing by Kenneth Li and Cynthia Osterman)

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