Whenever something like this comes to light, the real question I wonder about it the number of similar things that didn't get exposed. E.g., the acquirer is too embarrassed to admit they got taken. Or too chaotic to notice. Or the founder stays on and is sufficiently good at covering things up. Or just charming enough that it's all let go. Or there's a post-acquisition strategic change or high-level executive turnover such that nobody really notices or cares that it never works. Or that it gets covered up internally because the executive who pushed for the deal doesn't want to look bad in front of other execs. And so on, and so on.

For those inclined to scoff, consider this blog: https://liesandstartuppr.blogspot.com/

It covers in detail a startup that was supposedly working on wireless power transmission via ultrasound. From the way he tells it, the company kept raising money long past the point it was obvious the technology couldn't work.