Elizabeth Holmes trial: Theranos founder’s fate now in jury’s hands

SAN JOSE — Theranos founder Elizabeth Holmes’ fate is now in the hands of the eight men and four women on the jury in her criminal fraud trial.

Holmes, a Stanford University dropout who founded the defunct Palo Alto blood-testing startup at age 19 in 2003, is charged with allegedly bilking investors out of hundreds of millions of dollars and defrauding patients with false claims that the company’s machines could conduct a full range of tests using just a few drops of blood, when she knew the technology had serious accuracy problems.

The charismatic Holmes, 37, has been on trial on 11 felony fraud counts since early September, with the proceedings attracting nation-wide attention, and large numbers of media and spectators arriving in the early morning hours to vie for 34 spots in the socially distanced main courtroom. Jurors have taken in testimony from 32 witnesses — including patients, investors, company insiders, and Holmes as her own primary witness in her own defense — and hundreds of displayed emails, text messages and published materials.

Judge Edward Davila on Friday gave the jury instructions Friday on how to consider the testimony and evidence they have heard and seen over the 14 weeks. The jury will start deliberating Monday morning.

“Do not allow personal likes or dislikes, sympathy, prejudice, fear or public opinion to influence you,” Davila said, noting that jurors must also avoid considering Holmes’ “position in life or the community.”

Jurors can examine whether Holmes had a “good faith belief” in the truth of her statements, and can take into account “evidence of Ms. Holmes’ words, acts or omissions,” Davila told the jury. Holmes does not need to have made a profit to be found guilty of fraud, he added.

Davila also made clear that the case against Holmes’ co-accused, her former lover and Theranos chief operating officer Sunny Balwani, whom she alleged sexually abused her and controlled her in work and life, is not before the jury. “Do not speculate why,” the judge said. “This fact should not influence your verdict.”

Of the fraud charges, two allege she and Balwani committed conspiracy, one against patients and the other against investors Two charges relate to patients, one who received blood test results indicating possible HIV infection and one receiving results suggesting possible prostate cancer. Six charges concern investors. One concerns marketing and advertising alleged to have been part of the fraud against patients.

A lawyer for Balwani has declined to comment on Holmes’ claims of abuse and coercion.

The judge’s instructions to the jury followed the conclusion of closing arguments by the defense and prosecution.

Holmes lawyer Kevin Downey hammered in key elements of his client’s defense, and emphasized that Holmes, worth $4.5 billion in stock at one point, never sold any shares. “At the first sign of trouble, crooks cash out, criminals cover up and rats flee a sinking ship,” Downey said. Holmes, he says, “went down with that ship when it went down. That is who this woman is. You don’t need more from me to know what her intent was.”

In a rebuttal, prosecutor John Bostic countered that “the disease that plagued Theranos wasn’t a lack of effort, it was a lack of honesty.”

There were people in the company who valued accuracy and reliability in blood-testing technology, Bostic said, but “Ms. Holmes was not one of those people, and she was in charge.”

“We see a CEO of a company who was so desperate for the company to succeed, so afraid of failure, that she was willing to do anything.”

Addressing Holmes’ emotional claims about Balwani on the witness stand, Bostic insisted jurors must put her allegations out of their minds, stating that there is “no evidence connecting the allegations of abuse with the actual charged conduct,” he cla.

Holmes faces maximum penalties of 20 years in prison and fines for every fraud count if convicted, plus possible restitution has said. Jurors are forbidden from considering any punishment, which will decided by Davila if the jury finds Holmes guilty.

Legal analyst Michele Hagan, who has attended the trial regularly, said she expects Holmes, if convicted, to file an appeal in state appeals court, which could delay a possible prison sentence by a year or more, though Hagan added, “it’s very difficult to win an appeal.”