While John Fuisz’s anger was boiling over, his father and brother
were becoming concerned with how expensive the litigation was
getting. They had hired the Los Angeles law firm Kendall Brill &
Klieger to represent them at a cost of about $150,000 a month. Laura
Brill, the partner who was handling their case, wanted to file an anti-
SLAPP motion to try to get the Theranos suit thrown out as frivolous,
which would have cost an additional $500,000 with little assurance
that it would succeed. They decided to switch to a smaller and less
expensive Northern California firm called Banie & Ishimoto and hired
the George Washington University Law School professor Stephen
Saltzburg, who had done legal work for Fuisz in the past, to oversee its
work.
On the other side, they knew they were up against one of the most
expensive lawyers in the world. Boies charged clients nearly a
thousand dollars an hour and was reputed to earn more than $10
million a year. What they didn’t know, however, was that in this
instance he had accepted stock in lieu of his regular fees. Elizabeth had
granted his firm 300,000 Theranos shares at a price of $15 a share,
which put a sticker price of $4.5 million on Boies’s services.
It wasn’t the first time Boies had worked out an alternative fee
arrangement with a client and taken stock for payment. During the
dot-com boom, he had accepted shares to represent WebMD, the
website that provides medical information to consumers. Boies had a
venture capitalist’s approach to cases and figured he and his firm
stood to earn a lot more money by getting paid in stock. But it also
meant he had a vested financial interest in Theranos that made him
more than just its legal advocate. It helped explain why, in early 2013,
Boies began attending all of the company’s board meetings.
—
EVEN THOUGH Elizabeth’s name was on all of Theranos’s patents,
Richard Fuisz was highly skeptical that a college dropout with no
medical or scientific training had done much real inventing. What was
more likely, he thought, was that other employees with advanced