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Dr. James Doty

Dr. James Doty’s life story sounds like something out of a Horatio Alger novel. The son of an invalid mother, raised in poverty, he worked hard in school so that when he got into Tulane University he could work even harder. He got into the medical school, became a doctor and helped people.

He became a neurosurgeon practicing in Newport Beach, California, and serving on Stanford University’s faculty. In the late 1990s, Doty became chief executive officer of Accuray Inc., a high-tech company he rescued from bankruptcy by convincing some Taiwanese investors to put up $18.5 million, money Doty personally guaranteed. Along the way, Doty invested in some other medical technology companies and by 2000 rode the dot-com boom to fabulous wealth: $75 million on paper. Retirement beckoned, along with a villa in Tuscany, a $5 million penthouse in San Francisco, a 6,500-acre island in New Zealand and charitable work in Third World countries. Doty decided to donate his Accuray stock to a charitable trust that would benefit Tulane, Stanford and other worthy causes.

Then the dot-com boom went bust. The villa, the penthouse, the island and his retirement plans vaporized.

“To make a long story short, suddenly, in six weeks, I was minus $3 million or so,” Doty said.

Doty’s only remaining asset was the Accuray stock, which he had yet to commit to the trust. Doty’s friends chimed in with helpful advice.

“Essentially, what everybody said was, ‘Look, that’s the only thing you have left. Save it for yourself,’” Doty said. “But I had made commitments to different groups, and I decided to honor those commitments.”

Doty’s friends chimed in again.

“It was essentially 100 percent that I was crazy,” Doty said.

Despite his friends’ best efforts, Doty put the stock in trust and moved on with his life.

In February, Accuray, the maker of the CyberKnife, a radio-surgery device used in treating tumors, went public.

Doty described the IPO (initial public offering) as “wildly successful.”

The IPO generated more than $1 billion.

Doty’s shares eventually churned out $37 million for the trust, he said. Tulane’s shares brought the school a little less than $4.5 million. Stanford’s shares brought in $5.4 million.

At Tulane, the money endowed a chair for the dean of the school of medicine, said Yvette Jones, Tulane’s chief operating officer and senior vice president for external affairs. The money also established a scholarship to help economically disadvantaged students attend medical school; the income from the endowment is enough to provide one student each year with a full ride.

At Stanford, Doty’s donation has endowed a chair in the neurosurgery department, according to the Stanford Report. The funds will also aid research in spinal cord injuries as well as a project with the Dalai Lama to look at the neurological basis for compassion and altruism. Researchers will use functional MRIs to evaluate how people make those decisions, said Doty, who laughed when asked if he would be one of the test subjects.

Doty, whose story has been featured in the Wall Street Journal, said he never asked to reconfigure his donation, nor did the charities offer.

“The charities are in charge of getting the money,” he said. “They’re not in charge of helping wealthy donors continue to be wealthy .”

When the Journal story broke, Doty got calls from all sorts of media, including “Oprah” and “Good Morning America.” Everyone wanted to know if he had lost his house and if he was starving.

Doty told the shows he’s still a neurosurgeon, and neurosurgeons are paid very well. He lives in a nice house and can provide for his family.

He has spent most of the last four years in Gulfport, Miss. He had visited Memorial Hospital as a consultant — he was a member of Stanford’s faculty at the time — and discovered the hospital had no neurosurgery coverage. “I thought I could help out,” Doty said.

He presented a plan to the hospital’s administration. The hospital now has full-service neurosurgery and neurology departments, inpatient/outpatient spinal cord injury services, a brain trauma program and a neuro ICU. Memorial is also the only Mississippi hospital that is stroke-certified by the Joint Commission on Accreditation of Healthcare Organizations.

Doty plans to return to Stanford’s faculty full time in January.

Jones said she thinks Doty is a “serial entrepreneur,” and that he will do something just as remarkable in the coming years as he already has.

Doty said he does not regret the decisions in his life.

“Look, I’m the luckiest guy in the world. I can’t complain at all,” he said. “I get to help people every day.”




December 2007

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