SAN JOSE, Calif. — For the six days that Elizabeth Holmes, the founding father of the failed blood-testing start-up Theranos, took the stand in her fraud trial, she blamed others, accused a former boyfriend of abusing and controlling her, and reframed her actions as making an attempt to do good for her firm.
On Tuesday, Ms. Holmes capped her protection with flat denials.
“I don’t suppose I did that,” she mentioned in response to a query about whether or not she had minimized the findings of a devastating regulatory inspection at Theranos. She then blamed her firm’s attorneys for “doing a number of the speaking in that assembly.”
The feedback ended Ms. Holmes’s major testimony, which stood out because the rarest of rarities. Few technology executives, not to mention a feminine tech government, are ever charged with legal fraud. Even fewer take the stand to defend themselves. Her time on the stand, which is prone to formally end on Wednesday, was the climax to a trial that has captivated the enterprise world and been held up as a parable of Silicon Valley’s fake-it-till-you-make-it culture on overdrive.
Ms. Holmes, 37, has pleaded not responsible to 11 counts of fraud for claims she made as chief government of Theranos, which she based in 2003. If convicted, she faces as much as 20 years in jail.
Her trial is now transferring into its finish stage. Both aspect might name closing witnesses over the approaching days, adopted by closing arguments and detailed directions to jurors for his or her deliberations on a verdict.
“The jury bought to know her over six days,” Jeffrey Cohen, an affiliate professor at Boston Faculty Legislation College, mentioned of Ms. Holmes. “If the protection is profitable, that could be the choice that can make the distinction.”
For a lot of the proceedings, the jury heard witnesses testify in regards to the particulars of Ms. Holmes’s alleged fraud. Theranos rose to prominence, elevating $945 million in funding, by claiming that its revolutionary machines may carry out a whole bunch of checks utilizing solely a tiny drop of blood. The hype made Ms. Holmes a fixture on journal covers that hailed her as the following Steve Jobs.
However a 2015 expose in The Wall Avenue Journal uncovered issues with Theranos’s blood checks, kicking off a downward spiral of regulatory crackdowns and lawsuits. The corporate dissolved in 2018, and Ms. Holmes was indicted.
Since her trial started in September, prosecutors have known as dozens of witnesses, together with former board members, lab administrators, staff, buyers, sufferers and enterprise companions. They’ve revealed the main points of falsified documents, outlandish monetary projections, unrealistic guarantees and faked demonstrations at Theranos. Witnesses usually spent hours on the tedious trivia of finance, chemistry, know-how and phlebotomy.
A lot of the case in opposition to Ms. Holmes has relied on her emails and textual content messages to tie her on to the corporate’s issues. Prosecutors should persuade the jury that Ms. Holmes knew in regards to the issues and didn’t disclose them to the folks pouring cash into Theranos and to the sufferers counting on its blood checks to make medical selections.
In her protection, Mr. Holmes’s attorneys tried displaying that the witnesses’ tales have been extra sophisticated than they’d let on. Protection attorneys hit investors for not doing sufficient analysis on Theranos earlier than investing. And so they tried blaming lab administrators for issues with the accuracy of Theranos’s checks.
Via all of it, Ms. Holmes sat up stick-straight in her chair and stared straight forward, her expression obscured by a masks.
After prosecutors rested their case final month, and earlier than calling Ms. Holmes to the stand, her attorneys launched temporary testimony from a biotechnology government who joined Theranos’s board of administrators after it got here underneath fireplace from the media and regulators.
Ms. Holmes then provided a wide range of excuses for Theranos’s shortcomings. She mentioned others had misinterpreted her statements about what Theranos’s know-how may do. She mentioned that, till a 2015 regulatory inspection revealed a bunch of issues and compelled Theranos to void its checks, she believed its checks labored. She mentioned she hadn’t been certified to run a lab and had relied on the statements of others.
She additionally admitted to including the logos of pharmaceutical corporations to a sequence of stories, which implied the drug makers had endorsed Theranos’s know-how once they hadn’t. For this, she expressed remorse.
Her direct testimony ended with a bombshell revelation that Ramesh Balwani, her former boyfriend, enterprise companion and alleged co-conspirator, emotionally and physically abused her. Via tears, she testified that Mr. Balwani had managed each facet of her life — together with her schedule, food regimen and presentation — and had even compelled her to have intercourse with him in opposition to her will.
On cross-examination, she choked up once more when prosecutors had her learn textual content messages with Mr. Balwani that confirmed a extra affectionate aspect of their relationship. Prosecutors elicited a number of extra mea culpas from Ms. Holmes, together with remorse over how she dealt with the Journal exposé and a positive Fortune cover story in regards to the firm that was later closely corrected.
This week, prosecutors homed in on the discrepancies between what Ms. Holmes mentioned in her testimony and what buyers mentioned she had instructed them. Quite a few Theranos companions and buyers testified that they’d believed the corporate had contracts with the navy and deployed its know-how in medevacs and on battlefields, for instance.
One of many prosecutors, Robert Leach, an assistant U.S. lawyer, requested Ms. Holmes totally different variations of the identical query repeatedly to hammer the dearth of navy contracts. She confirmed that Theranos had not had the contracts.
To indicate that Theranos was by no means paid for work with the drug maker GlaxoSmithKline, Mr. Leach additionally repeatedly requested Ms. Holmes in regards to the lack of income, posing the query for annually from 2007 to 2014. Ms. Holmes mentioned no every time.
Ms. Holmes resisted lots of Mr. Leach’s strains of questioning by testifying that she didn’t recall or didn’t know. She additionally tried to dispute particulars in sure questions.
Ms. Holmes’s attorneys questioned her for a second time Tuesday afternoon with a rapid-fire sequence of statements meant to undermine Mr. Leach’s factors and reiterate her preliminary testimony. As soon as once more, Ms. Holmes mentioned that Mr. Balwani had created Theranos’s unrealistic monetary projections and that Theranos’s scientists had put collectively stories on its know-how.
Till a regulatory inspection revealed deeper issues, she testified, she thought Theranos’s lab was “wonderful.” Ms. Holmes additionally repeatedly pressured her considerations over exposing Theranos’s commerce secrets and techniques as an excuse for withholding info from buyers and companions, testifying once more that she fearful the corporate would lose its skill to compete. Discussing Theranos’s use of third-party machines would have violated Theranos’s personal trade-secret coverage, she mentioned.
Mr. Leach tried flattening that argument by noting that the majority of Theranos’s buyers and companions had signed nondisclosure agreements that Ms. Holmes anticipated to be adopted.
He additional famous that, regardless of Ms. Holmes’s holding a patent for some know-how, a patent didn’t “essentially imply the invention described within the patent works.” Mr. Leach requested her if she had created a tablet that measures lipids in blood, as described in a single Theranos patent.
Ms. Holmes smiled, leaned into the microphone and mentioned, “Not but.”
Erin Woo contributed reporting.