LDN - Business

Theranos founder Elizabeth Holmes takes stand in fraud case

[November 20, 2021] By Jody Godoy

SAN JOSE, Calif. (Reuters) -Theranos founder Elizabeth Holmes took the stand on Friday to defend herself against charges of defrauding investors and patients about the now-defunct blood-testing startup once valued at $9 billion.

Holmes, 37, is accused of making false claims about Theranos, including that its technology could run a range of diagnostic tests more quickly and accurately than conventional laboratory testing with a drop of blood from a finger prick.

Removing her blue mask to testify, Holmes said that her work at Theranos led her to believe in the company's technology.

Holmes told the jury about early efforts to raise capital, testifying that she had met with Sillicon Valley venture capitalist Don Lucas, who ultimately invested and became the chairman of Theranos' board.

"I knew him as someone who focused on building great companies for the long term," she said. "He had a lot of questions. He began a very comprehensive diligence process," including asking for Theranos' financial information.

Defendants are not required to testify in criminal cases, but sometimes do so in a bid to create reasonable doubt about their guilt by punching holes in the prosecution's case.

A major risk is that prosecutors can cross examine them, in an effort to expose possible inconsistencies or lies in their testimony.

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Former Theranos CEO Elizabeth Holmes arrives for a hearing at a federal court in San Jose, California, U.S., July 17, 2019. REUTERS/Stephen Lam/File Photo

Once touted as the Steve Jobs of biotech for her company’s supposedly innovative technology, Holmes faces nine counts of wire fraud and two counts of conspiracy. She has pleaded not guilty.

Over the course of the two-month trial, jurors in San Jose, California, have heard testimony from more than two dozen witnesses for the prosecution, including patients and investors whom prosecutors say Holmes deceived. At the close of their case on Friday, prosecutors moved to dismiss one count of fraud regarding a patient.

Defense attorney Lance Wade told jurors during opening statements in September that Holmes was a hardworking young entrepreneur who had underestimated the obstacles Theranos faced before it failed.

Founded by Holmes at the age of 19 in 2003, Theranos garnered attention from private investors.

Its fortunes waned after the Wall Street Journal published a series of articles starting in 2015 that suggested the Theranos devices were flawed and inaccurate.

(Reporting by Jody Godoy;Editing by Noeleen Walder, Bill Berkrot and Sandra Maler)

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