web analytics

UPDATED: Former Johnson & Johnson Ethicon Acclarent Indicted Executives Bond Out on $5 Million & $500,000

UPDATED: Former Johnson & Johnson Ethicon Acclarent Indicted Executives Bond Out on $5 Million & $500,000

UPDATED June 25, 2015 (in the indictment section near point 10)

Attorneys looking at Bill Facteau from Palo Alto 6 17 2015

UPDATED: June 17, 2015 Well look who paid the site a visit today? None other than the attorney group representing William (Bill) Facteau against his 18 count federal indictment.  Attorney Leo Cunningham of Wilson Sonsini Goodrich & Rosati in Palo Alto, had some glowing words about his client.

“This is a complicated area of regulatory law. I think that the prosecutors have got it absolutely wrong,” said Facteau’s lawyer Leo Cunningham when contacted by Qmed.

“Bill Facteau is a guy who has worked hard all his life. He’s extremely ethical. I’ve been representing executives like him for over 20 years, and I’ve prosecuted people. And Bill is one of the good guys. That’s what we think the evidence is going to show once it’s blatantly understood,” said Cunningham, who is a partner at is a partner in Wilson Sonsini Goodrich & Rosati in Palo Alto, CA.

Mr. Cunningham clearly without shame, remorse guilt or accountability placed blame on while demeaning and insulting federal prosecuters; and, I’d suspect the first Mrs. Facteau may challenge William (Bill) Facteau’s ethics.   I can’t recall a time a defense attorney came out and ever said their client was guilty.

A recent example from the news:   Police have not detailed why Wint would want to kill 46-year-old Savvas Savopoulos; his 47-year-old wife, Amy; their son, Philip; and housekeeper Veralicia Figueroa. Three of the four victims had been stabbed or bludgeoned before the fire.

Attorney Robin Ficker said Wint didn’t seem violent when he defended him in earlier cases.

“My impression of him — I remember him rather well — is that he wouldn’t hurt a fly. He’s a very nice person,” Ficker said.

Sure “extremely ethical” or “wouldn’t hurt a fly,” except of course when the evidence points to the contrary.  Defense attorneys are often inconsistent & contradictory in their language to action and Mr. Cunningham’s glib it’s a “complicated area of regulatory law,” is laughable to anyone who worked at Acclarent and it appears to the DOJ as well because it’s not like those charges were a slap on the wrist or an unpaid parking ticket.  Luckily Mr. Cunningham is in the right part of the world as he’ll be kept very busy defending executives like Facteau as part of growing fraud trend in startups.

Please take the anonymous #KnowYourValue survey

April 16, 2015

DOJ Press Release April 10 Former Acclarent Executives Arrested & Charged with Securities Crimes

The anatomy of a medical device startup:



VC funding

(NEA, JJDC, Versant Ventures, Meritech & Delphi Ventures)






(Johnson & Johnson (Ethicon))


Alleged Fraud

Those familiar* with the startup fairy tale of ENT medical device maker Acclarent based in Menlo Park, CA , made popular by Balloon Sinuplasty which sold to Johnson & Johnson’s Ethicon Unit for $785 million in 2010 didn’t think this fairy tale would end with two of their former executives trading gold Rolexes out for handcuffs but that’s just what happened last week.

*Disclosure: I worked for Acclarent under the direction of Facteau, Fabian and others from June 2007 until my wrongful termination in January 2011. 

Description of Offense Charged Former Johnson & Johnson Ethicon Acclarent Executives Facteau & Fabian

Acclarent CEO from 2004 until November 2011 William (Bill) Facteau, Atherton, CA made $30 million of the sale of the company and was taken into federal custody on Thursday, April 9, 2015 and paperwork was released on Tuesday, April 14, 2015 after posting a $5 million bond*.  Acclarent VP of Sales and Marketing from 2007-until November 2011 Patrick (Pat) Fabian who made $4 million on the sale of the company was taken into federal custody on Thursday, April 9, 2015 and paperwork released on Friday, April 10, 2010 after posting $500,000 bond. Facteau & Fabian were accused of 18 counts of fraud ranging from Conspiracy, Securities Fraud, Wire Fraud, Food, Drug & Comsmetic Act Violations and were made to surrender passports.

Other cases that bonded out at $5 Million-Child Trafficking, Man Charged with Killing Wife, Mom Accused of Beheading Death.  White collar crime also warrants multi-million dollar bonds, and to give context:

Bernie Madoff for example bonded out at $10 million was sentenced to 150 years in jail while ordered to pay $170 billion in restitution.

Dennis Kozlowski (Tyco CEO-also part of the medical device industry) was accused of stealing $600 million and bonded out at $5 million and in 2005 sentenced between 8.25 and 24 years for enterprise corruption & grand larceny.

Jeff Skilling & Andrew Fastow, former Enron executives, both bonded out at $5 million each and were charged with fraud and various conspiracy crimes.  Fastow plead guility (received six years in jail) and agreed to flip on Fastow who was convicted on 19 counts of fraud and sentenced to 24 years in jail.

Factau Acclarent $5 million Bond Fabian $500,000 bond

Sourced through Pacer

*To provide further contextual fact (and not meant to demean or insult) per the paperwork, Mr. Facteau must post the full amount of the $5 million bond by April 30, 2015 or the bond could be revoked & he could be taken back into federal custody.

Bond is set at the judge’s discretion based on all the facts  and it’s likely rightfully (in this case) also related to the $30 million Mr. Facteau reported received from the sale of the company which also explains the expected difference between his bond and Mr. Fabian’s bond at $500,000 who received $4 million in the sale which justifies the drastic comparison.

The details contained in the indictment are allegations.  The defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

A common complaint among those in the pharma and med device industry is that executives are never held accountable and that companies pay huge fines but nothing changes.   That same complaint is also echoed by injured patients, consumers and taxpayers alike.  Let’s hope executive indictments leading to jail time become a trend.

Checklist-of-Characteristic-of-The-Sociopathic-Business-Model (1)

It’s often been said on this site that startups are incorrectly under the impression that the rules or laws do not apply to them since they’re too small and aren’t on the government’s radar.  Startups recently challenged for their lack of diversity often continue with illegal activity where abusive behavior like retaliation, racism & sexism are wrapped in the manipulation of the privilege of a paycheck and stock options which have just become accepted as the cost of doing business.  It’s important to understand the startup process in order to see if there are potential patterns in possible fraud known on this site as The Sociopathic Business Model™ .

NEA Funded ExploraMed Created Startup Acclarent Josh Makower 1

New Enterprise Associates NEA is one of the world’s largest and most active venture capital firms according to their website.

Venture capital (VC) is financial capital provided to early-stage, high-potential, growth startup companies. The venture capital fund earns money by owning equity in the companies it invests in, which usually have a novel technology or business model in high technology industries, such as biotechnology and IT.

Josh Makower MD Partner in VC NEA 2004 that funded startup Exploramed incubated Acclarent in 2004

NEA Nehra and Drant worked closely with Josh Makower ExploraMed Acclarent

NEA Special Partner John Nehra and NEA General Partner Ryan Drant represent the firm on the board of ExploraMed and worked closely with Dr. Makower to develop the successful ExploraMed medical device incubator model. “Incubation allows us to be actively involved in defining the scope of the project, assessing the capital requirements and ensuring that the technology is addressing large, available markets,” said Mr. Nehra.

NEA John Nehra and Ryan Drant board of ExploraMed which funded Acclarent

NEA– John Nehra appears to have recently transitioned over to retired special partner.

(The screenshot above was taken from the NEA site June 2014)

Venture Capital NEA funded ExploraMed Incubated Acclarent 2004ExploraMed is a venture-backed medical technology incubation company dedicated to the indentification, creation and development of new medical device solutions according to their website.

A Business Incubator is designed to accelerate the growth and success of entrepreneurial companies through an array of business support resources and services that could include physical office space, coaching and network connections.

Josh Makower MD Founder & CEO of ExploraMed 2004 & Co-Founder of Acclarent 2004


According the ExploraMed website Josh is the founder & CEO of ExploraMed a medical device incubator and a Venture Partner with NEA as well as serves as Chairman of the Board for ExploraMed, Nuelle, Moximed & NeoTract; and, is a member of the board of directors for Ceterix, Coravin and Intrinsic Therapeutics.

Inconsistent & contradictory language to action is what’s missing from Josh Makower’s Management Team ExploraMed bio is that he founded Acclarent in 2004 (the same year he became an NEA Venture Partner and founded incubator ExploraMed) which sold to Johnson & Johnson’s Ethicon unit for $785 million in 2010. That’s rather a big feather in an incubator’s cap to omit that information and if you’re a frequent reader of this site that’s a possible big red flag.

Wall Street Jounral Announces Johnson & Johnson Ethicon Buy Acclarent December 2009

SEO manipulation of the facts to distance from truthful negative information that could damage the image of a company is a tactic from The Sociopathic Business Model™ as a means to possibly shift accountability.

According to Stanford Biodesign Alumni Association Josh Makower was the founder of Acclarent , John Chang was VP of R&D and Bill Facteau (not going by William then) was President & CEO.

Stanford BioDesign Josh Makower Founder not Co-founder at Acclarent 2010It’s also inconsistent & contradictory language to action that ExploraMed now states that VP of R&D John Chang was also a co-founder with Josh Makower, MD at Accclarent where he was recently added to ExploraMed as Project Architect despite working with Makower several years prior to his founding ExploraMed in 2004:

Project Architects John Y Chang co-founder at Acclarent

Incubator ExploraMed Created Acclarent 2004

 Are VC’s the foundation for fraud? 

Are VCs the foundation for fraud JJDC NEA Meritech DelphiVentures Versant Ventures Acclarent

 Acclarent raised $104 million via Venture Capital from 2004 until 2009 along with NEA, Versant Ventures, Meritech, Delphi Ventures and Johnson & Johnson Development Corporation (Johnson & Johnson’s venture capital division) which all contributed to the startup.

Acclarent Time Line to the Alleged Executive Crime 4 17 2015

Bill Facteau Indictment 4 4 2015

Josh Makower, John Chang and Bill (William) Facteau all live in Northern California and Pat (Patrick) lives in Lake Elmo, MN.

Fifty Shades of Facteau


The DOJ announcement of an indictment wasn’t posted until Friday, April 10, 2015 yet on Saturday, April 4, 2015 someone in Redwood City did a very specific search for Bill Facteau former CEO of Acclarent indictiment means trial and not immediate conviction.

John Chang has 190 pending patents & Josh Makower holds over 200 medical device patents according to the ExploraMed website.  And perhaps one they didn’t allegedly originally own the rights to was for Acclarent’s flagship product a sinus balloon (later Balloon Sinuplasty) which resulted in a 2006 lawsuit from Quest Medical for patent infringement against Acclarent, ExploraMedII,  Josh Makower, John Chang and Bill Facteau (among others) as defendants:

Acclarent and Exploramed II “have aggressively taken many predatory actions in order to copy” Quest’s balloon dilation catheter, and have attempted to convince the scientist who holds the patent covering the catheter to void his contract with Quest and begin working for Acclarent, the complaint alleges.

Bill Facteau Indicted 4 9 2015

The DOJ announcement of an indictment wasn’t posted until Friday, April 10, 2015 yet someone in Palo Alto, CA used the tags John Chang, Earlens and Bill Facteau indicted on Thursday, April 9, 2015 and spent around 45 minutes on the site.  This indicates that someone knew something ahead of time or was nervous and it’s interesting that the one name missing from that search from that area is Acclarent Founder Josh Makower.  It’s not conclusive but it’s interesting as someone who follows patterns. It’s good to note what’s there and sometimes what’s obviously missing when looking to pattern. It also tipped me off that something was coming (since I understand enough of the analytics of the site) and have also noticed a pattern suspected in narcissism not unlike those same supected patterns in fraud.

Also inconsistent & contradictory language to action is Josh Makower’s story told later at a National Sales meeting of how he came up with the idea of the sinus balloon and sketched it for John Chang (if memory serves) on a cocktail napkin on one of their front porches-never to my knowledge was the 2006 Quest Medical lawsuit for patent infringement mentioned or positioned as part of the startup fairy tale.  The omission of this information could be viewed as a manipulation of the facts, not recognizing the rights of others, lack of shame, remorse or guilt, taking credit for others work, and creating a hopeless environment where all accomplices eventually become victims and are all tactics from The Sociopathic Business Model™.

The Sociopathic Business Model™

Fact based evidence over time is the best indicator of the future.  The problem with that statement is when an educated collective group purposely & willfully omit facts designed to manipulate others to engage in unethical and or illegal behavior for their own benefit it’s suspect at best and criminal at worst.   It’s often been said that an organization cannot ‘make an employee’ do anything illegal-either a person chooses to engage in that activity or not. That is however false when employees are not provided with all of the facts to make the best personal decisions based on those facts.  When an employer purposely & willfully chooses to manipulate facts for their own personal gain they’ve lied to their employees who in turn dispense that false information with possible dangerous outcomes to patients, consumers, employees, and taxpayers.     This Case Study: Acclarent will continue as more information is made available about the charges against former CEO William (Bill) Facteau & Patrick (Pat Fabian).  Facteau is currently CEO of Earlens & Fabian is currently Chief Commercial Officer at NxThera 

Who else is nervous and has pull in North Carolina?

Bill Facteau North Carolina Courts at 2 am on Saturday Evening 4 26 2015

North Carolina Administrative Office of the Courts using the tag William Facteau Earlens at 1:02 am (late Saturday/early Sunday) April 26, 2015.  I didn’t know the courts were open over the weekend.  Raleigh, North Carolina is about 16 miles from Cary, North Carolina where again the a very specific tag Bill Facteau Former CEO of Acclarent was used prior to the announcement of the indictment.


Bill Facteau 4 8 2015 3

UPDATED: April 27, 2015

Facteau Fabian Page 1 Part 1

Today, the 33-paged Federal Indictment of William (Bill) Facteau and Patrick (Pat) Fabian was loaded on to the anonymous industry message board MedTech[y]. (Both links are now dead)*  As part of the Case Study: Acclarent- a comparison of the indictment as it relates to The Sociopathic Business Model™  will follow via live blog format.  As with the patterns above look at what’s there and read between the lines on what might not be spelled out so clearly.

It’s clear now there was a Grand Jury Investigation which led to the indictment charges (estimated February 2015-April 2015).  People called to testify are not given a choice and asked to keep the details of the investigation confidential (asked but not required). Understandably many expressed concern fearing future employment retaliation or possible guilt over the outcome for cooperating with a federal investigation which led to the indictments.

That is again the design of The Sociopathic Business Model™  it creates guilt in employee victims who exposed the truth about unethical and or illegal behavior and the possible desire of others known and unknown to the Grand Jury who will potentially continue, as they’ve done in the past,  shift blame and not take accountability where creating fear or panic as a means to manipulate to try and suppress truth often includes threats and intimidation, and were are all too common at Acclarent.

Many are very pleased to see that justice is working: “It couldn’t happen to a nicer couple of assholes,” “I toasted at the airport bar the minute I heard the news,” “Anyone have pictures of the arrest?” “All those threats about our ‘failure to execute’-guess we finally executed on something well,” (were some of the printable responses) which may sound glib or celebratory to an outsider who did not endure pathological lies, threats, retaliation and intimidation which were entrenched at Acclarent and further still at the hands of Johnson & Johnson’s Ethicon’s Acclarent where unethical and or possible illegal behavior was not only encouraged and replicated it was rewarded at the expense of many good and ethical people.

(please check back for updates):

Facteau Fabian Indictment 1 2 Killing My Career

1.  No dates of employement were provided for Facteau 2.   Specific dates were provided for Fabian.

Facteau Fabian 3

Facteau Fabian 4 5 6

5.  “and others known and unknown to the Grand Jury,” implies some targets of the investigation were known and others were not, which also implies there are possibly future indictments from this Grand Jury Investigation possibly in conjunction with new information from the newly indicted.

6.  “for implanting,” is interesting language.

Facteau Fabian 7 8 9 10

7.  PRSPin: “Stratus was designed and intended to provide sustained delivery of drugs…”  PRSPinUnSpun:#InconsistentAndContradictory It was designed that way but when was it designed, who designed it and who funded the alleged fraud?

UPDATED 6/25/2015

Acclarent Patent 2004

Makower Chang Vrany Walke on Patent for drug delivery device patent in 2004

2004 Image

Patent 2004 Makower, Chang, Vrany, Walke

10. PRSpin Johnson & Johnson: “…concealed from potential purchasers such as Johnson & Johnson…$785 million…” Was that the orginally agreed upon price or was it lowered because of off-label concerns over Stratus?  PRSpinUnSpun Johnson & Johnson:  #InconsistentAndContradictory “very nervous” but complicit

JNJ Ethicon aware of Stratus off label promotion #TheSociopathicBusinessModel

Very nervous and very aware. Facteau Fabian 11 12 13 14

Facteau Fabian 15 16 17 18

Facteau Fabian 19 20

Facteau Fabian 21 22 23

510k Stratus Ethmois MicroFlow Space filed 2006 2

Stratus Microflow Ethmoid Spacer 510 (k) filed as KO62548 August 23, 2006

FDA decision September 15, 2006

What was this decision in 2006 that forced Acclarent to refile and with a new number in 2007? 

Acclarent 510k Submissions Stratus in 2006 and in 2007

Submissions show under another Stratus filing under FDA 510(k) Number K072891 on 10/10/2007 but the original 2006 filing KO62548 never went any further in the sytem. 

Acclarent Stratus Microflow Spacer 510k in 2007 missing

FDA 510(k) Number K072891 from 2007 was approved  March 19, 2008 and it’s like the original 2006 filing KO62548 never existed.  Is it because Acclarent filed a 510 (k) in 2006 as the 2004 patent included as a drug delivery system and the FDA was aware and made them refile without a drug?  

Under point 21 of the indictment it states:

Facteau, Fabian and others at Acclarent understood that the FDA would likely require significantly more testing and clinical data to permit the interstate distribution of Stratus as a steroid delivery device than it would require that did nothing more than maintain a space in the sinuses and release saline.  

Likely require or outright told by the FDA in 2006?  

Did Johnson & Johnsons Ethicons Acclarent give the FDA the finger final

And  Johnson & Johnson would know this during due diligence prior to the purchase in 2010.

Facteau Fabian 24 25

Facteau Fabian 26 27 28

Facteau Fabian 29 30

Facteau Fabian 31 32 33

Facteau Fabian 34 35 36 37

Facteau Fabian 38 39

Facteau Fabian 40 41 42

Facteau Fabian 43

Facteau Fabian 44 45

Facteau Fabian 46 47 48

Facteau Fabian 49 50 51

Facteau Fabian 52 53 54

Facteau Fabian 55 56

Facteau Fabian 57 58 59 60

Facteau Fabian 61 62 63

Facteau Fabian 64 65

Facteau Fabian 66 67 68

Facteau Fabian 69

Facteau Fabian 70

Facteau Fabian 71 72 a

Facteau Fabian 73

Facteau Fabian 74 75 76

Facteau Fabian 77

Facteau Fabian 78 79

Facteau Fabian 80

Facteau Fabian 81

Facteau Fabian 82 83 84

Facteau Fabian 85 86 87

Facteau Fabian 88 89

Facteau Fabian 90 91 92

Facteau Fabian 93 94

Facteau Fabian 95 96

Facteau Fabian 97 98 99

Facteau Fabian 100 101

Facteau Fabian 102 103

Facteau Fabian 104

Facteau Fabian 105 106 107

Facteau Fabian 108 109

Facteau Fabian 110

Facteau Fabian 111 112 113 114

Facteau Fabian 115 116

Facteau Fabian 116 A B

Facteau Fabian 117

Facteau Fabian 118

Facteau Fabian 119Facteau Fabian 120 a

Facteau Fabian 120 b c d e f

Facteau Fabian 120 g h i

Facteau Fabian 120 j k l 121

Facteau Fabian 121 122

Facteau Fabian 123 124

Facteau Fabian 125

Facteau Fabian 126 127

Facteau Fabian 128 129 130

Facteau Fabian 131 132 133 134

Facteau Fabian 135 136

Facteau Fabian 136 a

Facteau Fabian 136 box

Facteau Fabian 137 138

Facteau Fabian 138 b

Facteau Fabian 138 box

Facteau Fabian 139 140

Facteau Fabian 140 box

Facteau Fabian 141 142 text

Facteau Fabian 142 Hospital Box

Facteau Fabian 143 144

Facteau Fabian 144 Hospital Box

Facteau Fabian 145

Facteau Fabian 146 part 1

Facteau Fabian 146 2 Sara Miron Bloom Patrick Callahan Johnson & Johnson Ethicon Acclarent Indictment

*I do not own, run or know who runs MedTech[y]-I support their efforts as they have fundamentally aligned with mine on this site Killing My Career in that it helps expose truthful information that the corrupt would rather remain hidden.

  • Maurice

    Thought you might it interesting that the chairman of DePuy Synthes was recently arrested, for a personal matter at church, but still nevertheless shows the personal character of him:

    May 2, 2015 at 3:20 pm

Post a Comment