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Defense Rests In Elizabeth Holmes' Fraud Trial After Seven Days Of Testimony From The Theranos Founder
A jury will soon take up the question of whether Elizabeth Holmes knowingly misled investors about her supposedly revolutionary blood-testing technology, or whether she was simply overly optimistic about its potential.
Elizabeth Holmes' defense has rested its case after the Theranos founder provided seven days of testimony.
Closing arguments in the high-profile trial are slated to begin next week and jurors will soon be tasked with determining whether Holmes knowingly lied about her blood-testing company’s capabilities, defrauding investors, board members and companies, as the prosecution has contended, or whether Holmes had simply been overly optimistic about a technology she believed did work, as the defense has argued.
For a jury to find her guilty, they must believe that 37-year-old had knowingly misled investors about a blood-testing device once touted as a breakthrough in the health care industry.
Holmes is facing 11 fraud-related charges in connection with the now-defunct company.
During the nearly four-month long trial, prosecutors called 29 witnesses—including former Theranos scientists, patients and investors—to demonstrate, they allege, how Holmes continued to make lofty claims about the company’s ability to run hundreds of tests with just a few drops of blood using a machine known as an Edison, raising millions of dollars from interested investors, even though she was aware of the company’s failing technology, NPR reports.
In reality, witnesses testified the device was never able to test for more than about a dozen diseases. Prosecutors argued that rather than divulge the Edison’s significant limitations, they began secretly running the tests on commercially available blood analyzers that had been modified by the company.
On the stand, Holmes acknowledged the company had used the commercial blood-testing machines, but said they never told other companies or investors because they had modified the machines in a way that they believed would make it a trade secret.
Assistant U.S. Attorney Robert Leach was quick to point out during questioning that there were other confidential aspects of the business that Theranos was comfortable sharing with Walgreens, CNN reports.
The prosecution also played audio of her boasting about partnerships that never materialized and presented numerous witnesses who testified that they were told the devices were being used on U.S. military members.
“My testimony is I don’t think I said that,” Holmes responded under questioning by the prosecution, also confirming that the devices were never used by soldiers or deployed in Afghanistan.
Prosecutors also pointed to reports that validated Theranos’ technology with the logos of pharmaceutical companies that Holmes admitted on the stand she had placed onto the documents, without the approval or knowledge of the companies.
The documents were then sent to investors. She argued that she altered the documents—a move she said she now regrets—because she believed the pharmaceutical companies did support the technology.
"I wish I had done it differently,” she said, according to the news outlet.
However, Holmes insisted she never purposely mislead investors and said her focus was on the company’s future potential.
"They were people who were long-term investors, and I wanted to talk about what this company could do a year from now, five years from now, 10 years from now," she said during some of her final comments Wednesday. "They weren't interested in today or tomorrow or next month. They were interested in what kind of change we could make."
She has insisted she believed the technology did work and shifted blame to lab directors and former boyfriend and business partner Ramesh “Sunny” Balwani, who was responsible for overseeing the lab and the company’s finances, The New York Times reports.
In emotional testimony on the stand, Holmes painted a portrait of an abusive and controlling relationship with Balwani, who was nearly 20 years her senior, telling the jury that he controlled nearly every aspect of her life, including her diet, what she wore, and her schedule.
She also testified that he forced her to have sex with him and kept her isolated from her family.
Holmes testified that during the lengthy relationship, the alleged abuse took a toll on her health and ability to see herself and the company clearly.
"He impacted everything about who I was, and I don't fully understand that," an emotional Holmes testified last week, according to CNN.
Balwani, who is facing his own fraud trial next year, has adamantly denied her allegations.
Under cross examination, Leach focused on Holmes’ position at the helm of the company.
“But, ultimately all roads, as the CEO, lead to you?” he asked, according to ABC News.
“Yes,” she relied.
“And is it fair [to say] that the buck stops with you?” Leach asked.
“I felt that,” she said.
While being redirected by her attorney Kevin Downey, Holmes testified that although she was at the head of the company, she wasn’t aware of every decision that was made.
Holmes’ defense largely relied on her own testimony, which lasted for seven days.
Closing statements in the case are scheduled to being on Dec. 16.