Elizabeth Holmes trial - live: Former Theranos employees expected to take the stand as founder accused of ‘lying and cheating’
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The trial of Theranos founder and former CEO Elizabeth Holmes continues on Tuesday as prosecutors representing the US government will attempt to prove to the jury that it was the intent of Ms Holmes to mislead investors, patients, and doctors about what her blood-testing technology was capable of in order to get ahold of their money.
During the opening statement for the US government, a federal prosecutor said that Ms Holmes “decided to lie” because she was “out of time and out of money”.
“This is a case about fraud, about lying and cheating to get money,” Prosecutor Robert Leach said. He added that in 2009, Theranos was short on cash as it got less and less work, and the company could barely pay its employees.
Lance Wade, a defence lawyer for Ms Holmes, told the court: “Elizabeth Holmes did not go to work every day to lie, cheat and steal. The government would have you believe that her company, that her entire life, is a fraud. That is wrong. That is not true.”
Ms Holmes, 37, who has pleaded not guilty, founded her company in 2003 at the age of 19 after dropping out of Stanford. The goal of Theranos was to radically change how blood testing is done. She now faces up to 20 years in prison if she is found guilty of the charges.
Court documents have revealed that the defence team may argue that another Theranos executive, Ramesh “Sunny” Balwani, 56, who is also Ms Holmes’ ex-boyfriend, emotionally, sexually, and physically abused Ms Holmes. That meant that he was in control, not her, the defence may argue. Mr Balwani, who served as the president and chief operating officer after joining Theranos in 2009, is facing his own trial early next year and has forcefully rejected the claims of abuse. He has also pleaded not guilty.
Theranos was at one point valued at $9bn as the company promised that their technology could test for diseases like cancer and diabetes by just taking a few drops of blood with a finger stick. Ms Holmes partnered up with retail giants such as Walgreens and Safeway and could be seen on the covers of magazines where she was described as the richest self-made woman.
But a 2015 Wall Street Journal investigation into the company was the beginning of the end for Theranos, which was dissolved in 2018. The trial of Ms Holmes, which has been delayed several times by the pandemic and her pregnancy, is expected to take around 13 weeks.
Former deputy district attorney says ‘anybody who was involved with the money’ will be a key witness
Former San Francisco deputy district attorney Michele Hagan told KRON4 News that “anybody who was involved with the money – those are going to be your key witnesses”.
She added that this was “absolutely” the reason that the prosecution chose Danise Yam, whose legal name is So Han Spivey, as their first witness as she managed Theranos’ finances for 11 years.
Elizabeth Holmes arrives for second day of testimony
Judge denies request from co-defendant for guaranteed access to Holmes trial
The federal judge in the trial of Elizabeth Holmes denied a request on Monday from her co-defendant Ramesh “Sunny” Balwani for guaranteed access to the legal proceedings.
In a memo on 23 August, Mr Balwani’s lawyers wrote: “Mr Balwani hereby moves this Court to reserve two seats for members of his defence team at Ms Holmes’ trial in order to maintain a level playing field between the defence and prosecution leading up to Mr Balwani’s trial.”
Judge Edward Davila didn’t explain his reasoning behind the denial of the request, YahooFinance reported.
Mr Balwani argued that his defence team could be excluded from accessing evidence found only within the courtroom because of the court’s first come, first served policy in accessing courtroom seating.
“Given the intense media and public interest in Ms Holmes’ trial and the large crowds expected to attend, Mr Balwani seeks to ensure that his defence team can observe these nonverbal indicia of credibility that bear so heavily on the case,” the motion from Mr Balwani said.
A reporter for Law360 tweeted on Tuesday morning that Mr Balwani’s counsel was waiting outside the courtroom along with the press two hours before the proceedings were scheduled to begin.
Mr Balwani’s trial is scheduled to begin early next year.
Possibly exposed juror tests negative and alternate called in after financial hardship excuse
The juror who had possibly been exposed to Covid-19, leading to Friday’s cancellation of proceedings, has tested negative for the virus on two separate occasions.
“We’re happy for that juror and that’s why we’re in session today,” Federal Judge Edward Davila said.
Another juror has been excused for financial hardship reasons, prompting the activation of one of the five selected alternate jurors.
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