Monday, January 22, 2018

Once A Promising Stanford MBA, He Now Faces Prison - Poets&Quants

Zachary Katz got into Stanford GSB as a brilliant 22-year-old Harvard graf. Then, tragedy struck. Katz (left) shortly after his arrest, and (right) posing for a promotional photo for a book he wrote

On a rainy early-January morning in Silicon Valley, two men in orange jumpsuits were escorted into Courtroom 4C inside the Superior Court of San Mateo County. They could not have been more different in appearance. The first man was older, gray-haired, and large, his thick forearms covered in tattoos. The second man was young, small, standing well under 6 feet, and very thin — tiny, really, with just a blank, somewhat timid facial expression. Holding some papers in his handcuffed hands, Zachary Katz took a seat at the far end of the dock and stared down, silent. It was a little less than five years since he had been a rising star beginning his first year in the full-time MBA program at Stanford’s Graduate School of Business.

After a lengthy court case involving multiple appeals, the 28-year-old originally from Long Island, New York, was convicted by a jury last November on one count of felony vehicular manslaughter under the influence of alcohol, one count of felony driving under the influence of alcohol causing bodily injury, and one count of felony driving with .08 percent or higher blood alcohol causing bodily injury. It took the jury four days to deliver its verdict, and some jurors could be seen weeping at the tragic outcome.

Katz was scheduled to be sentenced on that rainy January day, but San Mateo County Superior Court Judge Leland Davis granted him a three-week delay. Defense attorney Geoff Carr requested the continuance because Katz’s family was unable to travel during the major storm that was wreaking havoc on the Northeast. Katz will be sentenced this Friday (January 26).

ACCEPTED TO STANFORD’S MBA PROGRAM AT 22

On paper, Katz seemed to have everything going for him. His lawyer, Geoffrey Carr, was so awed by his intelligence that he calls him a Doogie Howser character after the precocious teenage protagonist in the once popular TV series. He’d been valedictorian of East Meadow High School in Long Island, accepted into Harvard University on scholarship. Katz would do some of his undergraduate coursework at the University of Oxford, ultimately graduating from Harvard summa cum laude with highest honors. Even before earning his Harvard degree in history and biochemistry, English and American literature, Katz had been accepted into Stanford’s full-time MBA program in 2009 as a 22-year-old — unusual at a school where the average age hovers closer to 26 — but he countered by asking the GSB’s admissions office to reinstate his acceptance in 2011, a request that was granted. He used the time wisely: After graduating Harvard with a 4.0 GPA, Katz earned — with distinction — a master’s in philosophy at the University of Cambridge in 2011.

But when it came time that year to enroll in Stanford’s full-time MBA program, Katz again vacillated. “The first delay was because I didn’t think I wanted to go to business school. The second delay was because I didn’t have money to pay for it,” Katz testified during his criminal trial, which lasted nearly a month from mid-October to early November of last year.

By the time Katz arrived on the campus of Stanford’s Graduate School of Business in the fall of 2013, he did so with a sterling resume: Harvard. Oxford. Cambridge. Stanford was the proverbial icing on the cake for a career with stratospheric potential. Katz had been admitted to three of the most elite and prestigious universities in the world, and at Harvard he had been a research fellow at the Center for Systems Biology. Armed with his Cambridge degree, Katz landed a plum job at Genentech where he led strategic planning for molecule teams in immunology, ophthalmology, and infectious diseases. It was hard to imagine anything in his future but success and acclaim. He was 24 when he began attending classes in Palo Alto, one of just 406 first-year MBA seekers in the Class of 2015. In the end, though, he would sit for only about three weeks’ worth of lectures and case studies.

THE NIGHT THAT CHANGED EVERYTHING

Zachary Katz. San Mateo Sheriff’s Department photo

October 4, 2013 was a Friday. Katz planned to meet his friend, Norman Underwood, at a bar called The Mix in the Castro district of San Francisco, according to court transcripts obtained by Poets&Quants. Katz left his Stanford dorm room around 9 p.m. and drove his Nissan Infiniti north from Palo Alto to San Francisco along Interstate 280. He arrived in the Castro and parked his car. He had packed an overnight toiletry bag, which he left in his trunk. Around 10 p.m., Katz and Underwood arrived at The Mix, where Katz ordered a rum and Diet Coke, which according to his testimony was Katz’s drink of choice because the soft drink masks the taste of alcohol. Around 11 p.m., he ordered another rum and Diet Coke and drank it.

At midnight, Katz and Underwood took a cab to a “pop-up event” in the South of Market district in San Francisco. Once there, a friend-of-a-friend ordered him another rum and Diet Coke, which Katz testified he started to drink but didn’t remember finishing. At that point, he testified, things got fuzzy. He remembered walking into a bathroom and having trouble standing up — and, most troubling, he smelled burning rubber and heard classical music.

AN UNUSUAL MEDICAL CONDITION

“I heard music,” Katz testified last fall. “And I felt that I had to be away from commotion, and I felt a really fearful panic that something was wrong, a tightness, and I didn’t know what was wrong, but I knew that something was wrong.”

The first time Katz smelled burning rubber and heard classical music was the summer of 2003. He was 14 years old and living in Miami with his uncle while volunteering in a lab at Miami Children’s Hospital. Burning rubber filled Katz’s nostrils while the music drowned out all other sound. His chest tightened and his fingers began to tingle. Some time later, he woke up in the backseat of his uncle’s car.

It was the first of many “episodes” Katz would experience. He testified that between 2008 and 2013, he experienced three to five episodes per year, in one case even temporarily losing his sight. As a result, Katz began taking anti-anxiety medication and antidepressants, self-diagnosing the issue as extreme anxiety. Finally, two years after the fatal accident, he was diagnosed with a form of epilepsy in 2015. 

THE FATAL COLLISION

During the wee hours of the morning on Saturday, October 5, 2013, California Highway Patrol officers responded to reports of a vehicle traveling northbound on the US-101 southbound freeway just south of San Francisco–and then, more grimly, of a three-car collision. When patrol officers arrived at the scene, they found Katz trapped in the driver’s seat of his car, conscious and breathing. “The odor of alcohol was emanating from Katz’s breath and person,” reads a court report from 2016.

Katz had been driving 65 miles an hour in the wrong direction down one of the Bay Area’s main arteries at around 3:30 in the morning. His Infiniti sedan slammed head-on into a Ford Escape SUV taxi, which then rolled over toward the shoulder and hit another southbound vehicle. A passenger in the cab, Pedro Juan Soldevilla, 62, of Puerto Rico, died at the scene after being ejected from the vehicle; the driver of the cab and a second passenger, who was traveling with Soldevilla, were hospitalized with major injuries. Both recovered. The driver of the third vehicle was not injured.

Soldevilla, who was headed to San Francisco International Airport to return to Puerto Rico, was a race car driver in the 1970s and ’80s who raced Porsches at such venues as Sebring and Daytona, in Florida. Nicknamed “Chiqui,” he was known as “a gentleman on the track, in his business and with his family life,” according to Jaime del Valle, a friend and owner of a Puerto Rico automotive services business. Del Valle said Soldevilla was in California because his company supplied prostheses to hospitals and he had been exploring more cost-effective products.

Soldevilla “saw a way to help his neighbor selling quality medical equipment and good prices, that’s how he was helping the country,” del Valle said. Soldevilla was a husband and a father, survived by his wife Wanda, a son, Pedro, and a daughter, Karina.

A scene from the accident, as shown on ABC Channel 7 in San Francisco

BLOOD-ALCOHOL LEVEL DOUBLE THE LEGAL LIMIT

According to court records, the Highway Patrol officer on the scene observed that Katz “displayed several objective signs and symptoms of alcohol intoxication: his speech was slurred and he had red, watery eyes.”

When Katz was removed from the vehicle he was “handcuffed by one wrist to a gurney inside the ambulance,” the report reads. “While speaking with the paramedic, Katz said he had consumed two rum and Diet Cokes that evening,” the report continues. According to Highway Patrol Officer Robert Rich, who testified in 2016, Katz said he had been driving “from South San Francisco en route to his home in Palo Alto.” However, Katz was actually driving northbound toward San Francisco — the opposite direction of Palo Alto — on the wrong side of the freeway for nearly two miles before the collision.

While still trapped in his own car, Katz was asked to submit to two preliminary alcohol screenings. The first showed a .158% blood-alcohol content, and the second showed .16%, exactly double the legal .08% limit. Another test administered at the hospital, about two hours after the crash, showed Katz’s level was .13%. According to an expert questioned by San Mateo County Deputy District Attorney Vishal Jangla, Katz’s blood-alcohol level equated to “about six drinks at 3:49 a.m. after accounting for burnoff.” According to the testimony of the Highway Patrol officer on the scene, Katz never refused the blood-alcohol tests — but he also never fully consented.

HIS DEFENSE TEAM ARGUED THAT HIS RIGHTS WERE VIOLATED

It was this latter fact that led San Mateo County District Attorney Steve Wagstaffe to call the case “a battle,” one that, according to Palo Alto Online, was drawn out over years, protracted by Katz’s efforts to keep the blood-alcohol test out of evidence. Katz’s defense was that the blood-draw violated his Fourth Amendment rights — and the court agreed, initially. A little more than two years after the accident, on October 27, 2015, San Mateo Superior Court Judge Barbara Mallach ruled that the blood test results were not admissible because Highway Patrol Officer Robert Rich did not read Katz the consent law. But this would not be the last word. Prosecutors filed an appeal on November 24, 2015, and the California First District Court of Appeal reinstated the blood tests on March 29, 2016. California’s Supreme Court agreed with the the Court of Appeal’s decision and refused to hear the case on June 15, 2016.

Eight days later, on June 13, 2016, the U.S. Supreme Court offered another glimmer of hope to the Katz defense when it ruled in an unrelated case that blood draws do, in fact, require warrants. Katz’s defense argued the case again in November 2016, but in January 2017, the state appeals court ruled the Supreme Court decision did not apply to the “inevitable discovery doctrine” on which the Katz case was based. The California Supreme Court refused to hear the case again in March 2017.

All the while, Katz was out of custody, having posted $250,000 bail.

GROWING UP ON LONG ISLAND

Zachary Katz grew up about a 40-minute train ride from New York City. His father bought and resold clothing in bulk, and his mother was an account clerk for a school district. Katz’s parents separated soon after he enrolled at Harvard. He later testified that he saw cars repossessed from his parent’s house and answered phone calls “when collection agencies have called” during his father’s two bankruptcies.

“I put myself through college besides the zero coupon bonds that my mother mentioned thanks to science scholarships and financial aid based on need, because my parents didn’t meet the basic income threshold,” Katz testified. Later, working at Genentech in San Francisco for two years before beginning his MBA at Stanford, Katz “regularly” sent checks home because he was making more than both his parents.

Katz also claimed to be a strong opponent of drunken driving, citing his role as president of his high school’s Students Against Drunk Driving chapter. “I’m extremely opposed to it, and it’s something I would never do,” Katz said in court. He seemed highly likable. An early profile of him noted that outside of work, you could find Katz playing the cello, doing community service, playing tennis, or trying to conquer a word puzzle of some kind. And he also loved the written word. 

EARLY PROFESSIONAL CAREER AND PUBLISHED NOVEL

Katz may have been at Stanford for business school, but literature appears to be one of his passions. His literary aspirations were evident even before he published his first book, Century Village, in 2014, the year after the accident that derailed his academic and professional life. At Harvard he had written for the Harvard Advocate, a journal of fiction, poetry, art, and criticism, in addition to his output for other publications in science, law, and research; in a blurb for his book, he describes how he was “encouraged to explore longer lyrical forms under Seamus Heaney and other resident scholars” at Harvard, and how he “first began to experiment with writing novels as a college sophomore.” His undergrad AB had a primary concentration in the History of Science with a secondary concentration in English Literature.

Katz’s professional calling, however, was the intersection of science and business. While in college he had completed internships in business development with OSI Pharmaceuticals, in health and research at Booz Allen Hamilton, and in “valuation analysis, landscape research, financial modeling, and due diligence to numerous healthcare deals” for JPMorgan, according to his LinkedIn profile. After graduation he did business development work for Diagnostics For All, a biotech company in Cambridge, Massachusetts; and for Genentech he was manager of pipeline and portfolio planning from March of 2011 to February of 2013, a job that made him responsible for helping to bring to market medicines in areas with high unmet medical need. 

But the accident seems to have shifted Katz’s career path. Since July 2013 the only jobs listed at his LinkedIn page are an 11-month stint as “chief strategy officer” for Oliver Inc., a New York-based web platform that connects renters with landlords and no-fee listings; and, beginning in February 2017, in operations and product analytics for Scentbird, a perfume subscription service that claims to be “disrupting a $40B perfume market” with an algorithm that places consumers in “fragrance archetypes.”

A ONE-TIME OCCURRENCE OR A LIFESTYLE?

Zachary Katz will be sentenced January 26 in San Mateo Superior Court

Katz’s first memory after the burning rubber smell and classical music was waking up and “being sideways in my car unable to move and in a lot of pain.” His left arm hurt and his right knee “was cut deeply,” according to his testimony. “I felt blood on me, and I was — I knew I was in my car. I had no sense of time or place, where I was, where the car was situated,” he testified. Nor did he remember talking to the police, saying he only remembered the responding officer from “the past few days in the courtroom.”

Katz did, however, remember being in the hospital handcuffed to the gurney. He was told he had driven drunk and killed another person. No one who was with Katz gave testimony as to what exactly happened between the time of his last memory, a little after midnight, and when he was found in his car at the scene of the accident. Katz’s defense was that the epileptic seizure, as well as antidepressants and the medications he took for anxiety — together with a potentially drugged drink — were to blame.

Yet a former friend, Samuel Grossberg, testified that Katz was a heavy drinker, and that he had driven drunk at least once in nearby Sonoma County in 2012.

The southbound stretch of U.S. Highway 101 near where Zachary Katz, driving the wrong way, collided head-on with an SUV cab, killing one and injuring two

‘PERHAPS HE SHOULD FOCUS MORE ON A RITE OF CONTRITION’

Public comments on a story about the Katz case at Palo Alto Online revealed the raw emotions common in cases involving fatalities, but also a surprising level of support for Katz and his defense of a medical emergency that led to the crash. In a comment that garnered 212 “likes,” one anonymous resident of East Palo Alto said that while it’s tragic a life was lost, “truth be told people do have severe quite medical issues that can cause problems! Through the grace of god go I!” The commenter went on to note how two of the victims were not wearing seatbelts, asking, “What happened to seat belt laws?”

Others were less sympathetic. “Yes, people do have medical issues while driving sometimes (not often). But being drunk and driving the wrong way is not a medical issue at all. It’s a criminal act,” wrote “ndn,” a resident of Downtown North, who added that he was fine with a sentence of 12 years, the maximum Katz faces. Another commenter, “Ryan,” insisted, “The facts are that Mr. Katz was intoxicated and decided to get behind of the wheel of a car, which led to the death of one individual and two others being injured. For that reason (despite procedural issues, random other medical ‘issues’ and whether the individuals were wearing seat belts), he was found guilty and should be held responsible for his actions.”

And in a comment at Amazon.com below the blurb for his book, Century Village, “Pedro Soul” alleged a lack of contrition on Katz’s part: “When this book was written, it was a sad scribble to save face on his deed. Similar to his Facebook posts that have since disappeared, this book was meant to improve popular opinion — he had shown no remorse and this book (and his everyday deeds while he was free prancing around New York City) attested to that. …

“Zak will probably write a more compelling book while he spends time in the slammer. Until then, perhaps he should focus more on a rite (of) contrition instead of a book about his Harvard education via sweatshirts that will not do him good with inmates in state prison.”

‘THERE’S A LOT OF ANGER AROUND THIS CASE’

This Friday, when he is again escorted into a San Mateo courtroom, Katz will finally be sentenced for his actions that night in October 2013. He’s looking at a maximum 12 years in prison (though prosecutors are seeking nine years). Added to whatever sentence he receives will be a lifetime of remorse, and the ruins of a once-promising career.

“I think there’s a lot of anger around this case,” Katz said under oath. “I lost a lot of friends after this happened because people judged me guilty before they understand — understood there might have been other circumstances, and, you know, the burden came on me to try to, you know, understand and instead of it being the, you know, a need for guilty proven or for guilty proven, it became a need for innocence proven.

“And I would put Sam (Grossberg) in a very large bucket of people who more or less cut off contact with me after this incident because the, you know, the occurrences of the night just were not something they were willing to process or fathom or talk through.”

DON’T MISS: STANFORD MBA STUDENT CHARGED WITH MANSLAUGHTER

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