Government rests case in trial of Theranos founder Elizabeth Holmes
Elizabeth Holmes (founder and ex-CEO of Theranos and the life sciences company Blood Testing and Life Sciences) arrives in San Jose for jury selection on the first day in the fraud trial. It will take place outside Federal Court San Jose.
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SAN JOSE (CALIF.) — The prosecution has dropped its case against Elizabeth Holmes, former CEO of Theranos. criminal fraud trialOver 11 weeks, 29 witnesses were called.
The former secretary of defense James Mattis was also present. He had been a Theranos board Member. Jurors heard from investors, patients and business partners, as well as doctors.
On Thursday, Roger Parloff (journalist and co-author of 2014 Fortune magazine) was the government’s last witness. cover storyHolmes was profiled by “This CEO is Out for Blood”, a documentary about Holmes. The article was claimed by the prosecution that Holmes, the founder of Theranos, used it to attract investors. Investors poured into the company’s blood-testing division, which eventually reached a valuation of $9 billion.
Holmes, 37, pleaded no guilty to 11 wire fraud and conspiracy wire fraud charges. Friday’s dismissal of one count related to a patient occurred. If convicted, the Stanford University graduate and ex-Silicon Valley star could be sentenced to up to 20 years in prison. She has denied wrongdoing.
The government has now been allowed to rest, and the attention will shift to Holmes’ defense. It is scheduled to start immediately. The jury heard Holmes’ voice several time, even on Thursday when Parloff recorded them.
However, they have not yet heard from Holmes and it is now a question of whether or not they will.
She was a “very risky person to testify”. Danny Cevallosa NBC News legal analyst, who has been following the case closely. She is very intelligent. She can cross-examine her about a lot more evidence from the prosecution, though she is unlikely to have a clear answer.
From her 2003 founding of Theranos, Holmes was seen as Theranos’ undisputed leader until it collapsed 15 years later. In documents that were released prior to the trial, it was revealed that the defense had not been able to prove its case. blamed Holmes’ ex-boyfriendRamesh Balwani was her former business partner. He abused and controlled her for over ten years.
Sunny Balwani is the ex-president and chief operating officers of Theranos Inc.
Michael Short | Bloomberg | Getty Images
Defense lawyers continued that line of attack during witness cross-examinations, claiming that Holmes placed blind faith in Balwani and put too much trust in her lab directors.
Cevallos stated that the defense must show that Holmes was not always in control and she did not intentionally deceive investors or patients.
Cevallos stated that “The defense must contend with the undisputed fact that Holmes is the boss” and that this technology did not work. It’s not an easy sell. There are emails and text messages from the government, as well as documents. Elizabeth Holmes is the one that was responsible for all of this, according to the government. “The defense will attempt to prove that they did it with certain things but not with all.”
Balwani, who was criminally accused of fraud, will also face trial.
An assistant U.S. attorney said late Thursday, after jurors had left the courtroom, that if the defense begins its case on Friday, it would likely call to the stand “a paralegal from the Williams & Connolly law firm, who is going to serve as a summary witness.”
The prosecution portrayed Holmes over the last 11 weeks as a manipulative fraudster that duped investors and patients by falsely claiming her company’s technology. She claimed it could run a number of blood tests starting with a finger poke.
Robert Leach, an Assistant U.S. Attorney, called Holmes repeatedly “a liar” and “a cheat”, both in his opening statements as well as through witness accounts.
Mattis is the highest-profile witness. told jurorsIn September, Theranos Board member Michael Sullivan revealed that he had been misinformed by Theranos about its technology capabilities.
“Looking back now I’m disappointed at the level of transparency from Ms. Holmes,” Mattis testified, adding “we were being deprived of fundamental issues.” Retired four-star General Mattis stated that he had invested $85,000 in the startup with his own funds.
He stated that there was a time when he “didn’t know what I believed about Theranos”.
Many company insiders. Former lab assistant and whistleblower. Erika CheungAccording to Theranos, the devices can only run twelve different tests. This contradicts company claims. Holmes told potential investors that Theranos proprietary technology could perform 1,000 blood tests.
Holmes, according to the prosecution, also deceived investors using unauthorized due diligence reports of leading drugmakers such as Dr. Hoffman. PfizerSchering-Plough, the company logos of which were included in the documents.
Wade MiquelonFormer chief financial officer WalgreensOne of many executives to receive a report with the unapproved logos was. Walgreens, which is a significant Theranos partnership, invested $140million in the company as part a deal to place the blood-testing device inside its stores.
After Theranos failed to meet its deadlines, the partnership collapsed. Walgreens filed suit against the company for breach of contract in 2016.
When jurors were able to hear from, the mystery surrounding the logo grew. Dr. Shane WeberPfizer scientist, Dr. Jeremy Smith. He evaluated blood-testing technology back in 2008. Theranos was not a good fit for the company.
Theranos sent Holmes a report to Walgreens that Holmes included the Pfizer logo. Holmes showed it to jurors. Weber stated that Pfizer did not approve the use of this logo.
A pedestrian walks by the Walgreens San Francisco store.
Justin Sullivan | Getty Images
Holmes was able to have many conversations with her colleagues, and they were always raising questions. Prosecutors emphasized the fact that Holmes’ “fake-it-until you make” strategy was costing lives.
Former lab director Adam RosendorffSix days of testimony was given by a witness who told jurors Holmes and Balwani had ignored their repeated warnings about the inability to use technology. Instead, he claimed the executives put the interests of their company and the public over patients’ health.
Kingshuk DasThe company’s last lab director said that he warned Holmes about the unreliability of the technology. Das claimed that he canceled 50,000-60,000 of the tests he had performed using this technology. Holmes received Theranos Edison blood-testing equipment and was informed by Holmes that it wasn’t working from the beginning.
Rosendorff as well Das claimed Holmes ignored their concerns.
Forbes named Holmes America’s richest woman in 2015, and her net worth was $4.5 million. Forbes named Holmes America’s richest self-made woman in 2015. In 2015, Forbes followed a series of Wall Street Journal articles that exposed Theranos’ shortcomings and false claims. loweredHolmes is worth “nothing”
The company was now worth more than $940million from its investors.
The jury heard testimony from some of Holmes’ backers who claimed they had invested heavily in the company because of Holmes’ lofty promises. A number of witnesses included: representativeBetsy DeVos was the former Education Secretary. Bryan Tolbert was the founder of a $5 million investment firm. Alan EisenmanTexas-based investor, John Sullivan, testified as well.
Finally, it was here Brian GrossmanPFM Health Sciences was the firm that invested $96 millions in Theranos. Grossman claimed that Holmes deceived him, despite doing extensive research on Holmes and getting his blood drawn in a Walgreens.
Grossman claimed that Theranos had proven the technology to be valid by large pharmaceutical companies as well as the Department of Defense. They used the technology on the battlefield, and in medevac helicopters.
The military environment is a harsh place for technology, such as one you would find in places like Afghanistan and Iraq. What could be a better way to use it? Grossman agreed. He added that Theranos had indicated the company earned “something like $200 million” from the Department of Defense.
It was all false.
Instead, Holmes’ optimistic projections about financial performance were false. The company was losing money by hundreds of millions, according to San Ho Spivey who testified. Danise Yam. Yam informed jurors that Theranos lost over $585million by 2015
The prosecution also pointed out a document that was given to investors and projected revenues for 2014 at $140 million, and 2015 at $990 million. Yam denied that she prepared the document.
Additional testimony was provided by three more patients. The three patients told alarming tales about getting inaccurate results following a Theranos test.
Erin TompkinsOne of the patients was a woman who said that she panicked when she found out she had HIV antibodies. However, the test came back negative.
Tompkins stated, “I felt quite emotional at that time.”