Theranos verdict: five key moments in the trial that rocked Silicon Valley | Theranos
EElizabeth Holmes, founder of blood testing company Theranos, was found guilty on Monday on four counts of fraud, ending a closely watched saga that could have major implications for the tech world.
Over the course of several months, federal prosecutors presented the jury with a case that Holmes knowingly scammed investors and patients, artificially inflating the value of Theranos and lying about the capabilities of its technology.
The lawsuit was almost as spectacular as the rapid rise and fall of the company, which in its heyday was hailed as a game changer and attracted hundreds of millions of investments. Here are five key moments to remember in the case that rocked Silicon Valley.
Leading investors take a stand
Holmes has been successful in winning over billionaire investors and building a board of directors made up of former U.S. cabinet members ranging from the Nixon administrations to Trump.
While most of these early Theranos players did not appear in court, one did make an appearance: James Mattis was called to testify by the prosecution early in the proceedings. He said he had personally invested $ 85,000 in the company, finding the technology “quite mind-blowing”, but lost confidence after the Wall Street Journal report.
âThere came a time when I didn’t know what to believe about Theranos,â he said.
Former employees speak out
The prosecution paraded a number of former Theranos employees as witnesses during the trial, including three different lab directors.
Former Theranos lab director Kingshuk Das said Holmes seemed reluctant to accept any criticism of Theranos technology, giving “implausible” excuses for the company’s apparent test failures.
âI have found these instruments not suitable for clinical use,â he said of the company’s proprietary Edison devices.
Other lab directors, Lynette Sawyer and Sunil Dhawan, said the work required “minimal” in-person work and that they spent the majority of their time doing paperwork, without testing the actual equipment used for the job. ‘blood analyse.
Other key testimonials came from Erika Cheung, a former Theranos employee, who spoke for three days to detail shortcomings in the company’s blood testing processes. She said she was very concerned about the accuracy of the technology and at times refused to analyze patient samples on the devices.
Patients “don’t know that behind closed doors we all have these problems and they think they are getting the correct results,” Cheung said. âIt was starting to get very, very uncomfortable and very stressful for me to work in the company. “
Holmes defends himself, alleges abuse
Perhaps the most shocking moment in the trial came when Holmes herself was called to the stand by her defense team to testify.
This risky move allowed him to make his point before the jury, potentially garnering more sympathy ahead of the deliberations. But it also opened her to cross-examination from the prosecution, in which lawyers grilled her for several days over inconsistencies in her story.
Holmes testified at the stand that she trusted her scientists’ claims that the Theranos technology was working as intended and that it had not deliberately misled anyone. She also presented explosive allegations that her former business partner and lover, Sunny Balwani, allegedly abused her, prompting her to commit fraud.
The two met when Balwani was 38 and Holmes was just 18. She said Balwani wanted her to “kill old Elizabeth”, controlling what she ate and who she spent time with so that she could become a successful CEO.
âHe taught me everything I thought I knew about business and he was the best businessman I know,â said Holmes. “I didn’t question him like I would have otherwise.”
The “smoking smoker”: pharmaceutical logos
One full piece of evidence prosecutors frequently returned to was that Holmes falsified documents sent to potential investors.
Walgreens chief financial officer Wade Miquelon said during his testimony that Holmes had suggested that pharmaceutical companies Pfizer and Schering-Plow had validated the company’s blood testing technology.
He said Holmes shared with potential investors and partners a document bearing the Pfizer logo, allegedly showing support for the drug company. But the document had been forged, claims the prosecution.
“Pfizer did not write this,” said prosecutor Robert Leach in opening arguments. âPfizer has not put its logo on it. Pfizer has not given permission to put its logo on it. Pfizer did not draw conclusions from this report.
In her testimony, Holmes admitted to having personally manipulated these documents, saying she did not do so to imply that the companies had controlled the technology, but “because this work was done in partnership with these companies and j ‘was trying to pass it on.
“I wish I had done it differently,” Holmes told jurors.
Evidence Provides Window on Holmes’ Life
Presented in evidence, amid thousands of pages of dense lab tests and scientific data, were a handful of documents that offered a window into Holmes’ state of mind as she stood at the head of the one of the busiest companies in Silicon Valley.
âI do whatever I say – word for word. I’m never a minute late. I’m not showing any excitement, âsaid a strict handwritten note to herself. She obsessively followed her food, drinking one green juice a day and avoiding sugar.
“ALL ABOUT BUSINESS.”
“I am not impulsive.”
“I am not reacting.”
âI am always proactive.
“I know the outcome of every encounter.”
“I do not hesitate.”
âI rarely speak. When I do – CRISP and CONCISE. I’m calling bullshit immediately. My hands are still in my pockets or gesturing, âthe note read.
Hundreds of pages of text messages between Holmes and Balwani were also on display, with many lovers and other commercials. In some, they referred to a bird they owned together. Further evidence: an aerial photo of a house they owned together in Atherton.
“You are the breeze in the desert [sic] for me – my water and my ocean, âshe wrote to Balwani in May 2015, according to a recent court file. “Okay,” he replied.
Both frequently used the phrase “hmfr” which, according to Holmes, refers to an Arabic phrase that roughly translates to “this too is the glory of my God”. In his journals and texts with Balwani, Holmes referred to a spiritual connection and the belief that God put Balwani in his life for a higher purpose.
“I love you,” reads a message from Balwani. âI prayed from the bottom of my heart for you. I have never prayed with this intensity in my life for anything.
âI love it,â Holmes replied. âMy nirvana. “