Warren Buffett's one-time heir apparent who resigned in disgrace amid accusations of insider trading has pleaded for a judge to be lenient in sentencing Theranos founder Elizabeth Holmes

PREVIEW David Sokol, Chairman, MidAmerican Energy Holdings, and Chairman, President, and CEO of NetJets, speaks during the Fortune Brainstorm Green conference in Dana Point, California April 13, 2010.
REUTERS/Mario Anzuoni
  • Elizabeth Holmes will be sentenced on Friday. Her team has filed 130 letters from friends and family seeking leniency.

  • One letter came from David Sokol, the former Berkshire Hathaway executive who stepped down amid allegations of insider trading.

  • In his letter, Sokol says Holmes' jury may have lacked the business knowledge he believes is necessary to reach an appropriate verdict in this case.

Elizabeth Holmes is asking for a lenient sentence, and an army of her friends and family have written to the judge to back her up.

The Theranos founder was found guilty on four counts of fraud and conspiracy in January and is due to be sentenced on Friday. She faces a maximum of 20 years in prison for each count on which she was convicted. While prosecutors want 15 years in prison, Holmes' attorneys have asked for 18 months under house arrest. With their plea for leniency, the defense submitted 130 letters from people who know Holmes and want the same.

One of these people is another executive who faced his own scandal while CEO: David Sokol. Though he's chairman and CEO of Teton Capital today, Sokol used to be CEO of Berkshire Hathaway's energy subsidiary and was believed to be a likely successor to Berkshire chairman Warren Buffett. While in that role, he bought $10 million worth of shares in chemical company Lubrizol Corporation and days later encouraged Buffett to buy the firm. The acquisition produced $3 million in trading profit for Sokol.

The SEC investigated but ultimately decided not to file insider trading charges against Sokol, though Berkshire said he violated the company's insider trading policy. Sokol resigned in 2011.

In his letter supporting Holmes, Sokol recounted his career and questioned whether the jury in her case knew enough about business to reach an appropriate verdict.

"Just as Ms. Holmes' decisions were not all flawless, neither is the jury system flawless," he wrote. "I accept the jury's decision in Ms. Holmes' trial. However, I also believe that such a trial revolves around extremely complex business realities which would be complicated for an experienced business person let alone someone not trained in such things as venture capital investing, accounting, proforma projections and related legal concepts and laws. As a knowledgeable investor, I can say with certainty that I would not have found Ms. Holmes guilty on any of the wire fraud charges."

Sokol said he knew Holmes to be "kind, smart, and a positive contributor to society."

"She will do far better for society if she is able to continue her inventing ways," he argued.

Later in his letter, Sokol even invoked Thomas Edison's name to make his case for leniency.

"Failure, while unfortunate, is understood and recognized as part of the creative process," he wrote. "Thomas Edison failed over 1,000 times by his own estimate. He was not a criminal. Neither is Ms. Holmes."

Sokol wrote that he has "no historic family or business relationship" with Holmes but met her in 2015 at a Horatio Alger Association of Distinguished Americans awards event.

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