Elizabeth Holmes spars with prosecutor in ongoing fraud trial

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Theranos founder and former CEO Elizabeth Holmes sparred with prosecutors in her fraud trial on Tuesday and again denied allegedly swindling patients and investors out of millions while knowingly producing a faulty testing device to enrich herself.

On the sixth day testifying in her own defense against fraud charges that could see her sentenced to 20 years in prison if convicted, Holmes responded to prosecutors at times with raised eyebrows and lighthearted smiles as she dodged some questions by responding that she didn’t remember certain events.

US Attorney Robert Leach interrogated the 37-year-old about a glowing Fortune cover story from 2014 and alleged lies that she made to investors in an effort that saw Theranos raise hundreds of millions of dollars.

The Fortune story, titled “This CEO Is Out For Blood,” made various claims that prosecutors said were false, including one that said Theranos “offers more than 200 — and is ramping up to offer more than 1,000 — of the most commonly ordered blood diagnostic tests, all without the need for a syringe.”

Theranos founder and former CEO Elizabeth Holmes has repeatedly denied the fraud allegations against her.
Theranos founder and former CEO Elizabeth Holmes has repeatedly denied the fraud allegations against her.
Justin Sullivan/Getty Images

Leach asked Holmes, “You agree with me that this was an incorrect statement?”

“I believe that now,” Holmes said.

Prosecutors had previously alleged that Holmes included the dubious cover story in investor presentations to hype up the company as well as her own celebrity.

According to court documents, Elizabeth Holmes sparred with the prosecution who claimed she knowingly created the faulty device.
According to court documents, Elizabeth Holmes sparred with the prosecution who claimed she knowingly created the faulty device.
EPA/JOHN G. MABANGLO

“You don’t have a memory of forwarding the Parloff article to investors or potential investors?” Leach asked Holmes, referring to the author of the story.

“I don’t,” Holmes said.

Leach then showed the jury an email Holmes sent to Theranos investors on June 12, 2014, which linked to the Fortune story.

Elizabeth Holmes (center)  arrive at the Robert F. Peckham Federal Building and US Courthouse along side her mother (left) and attorney (right) on December 7, 2021.
Elizabeth Holmes (center) arrives at the Robert F. Peckham Federal Building and US Courthouse alongside her mother (left) and attorney on December 7, 2021.
EPA/JOHN G. MABANGLO

“I think I could have handled those communications differently,” Holmes eventually conceded.

Throughout the cross-examination, Holmes stuck to the message that she genuinely believed Theranos was on the verge of a diagnostic testing breakthrough, and that she did not knowingly deceive anyone, investors, patients or otherwise.

“When I testified we could do it, I fully believe we could do it,” Holmes said Tuesday, later acknowledging that “there was still work to be done” on the company’s devices.

Elizabeth Holmes (center) and her defense team have repeatedly sought to blame co-CEO Ramesh "Sunny" Balwani for the faulty devices.
Elizabeth Holmes (center) and her defense team have repeatedly sought to blame co-CEO Ramesh “Sunny” Balwani for the faulty devices.
EPA/JOHN G. MABANGLO

Holmes’ testimony is nearing an end. Prosecutors on Tuesday closed out their cross-examination of her, and now her defenders will have a final turn to question her. After that, both sides will deliver closing arguments, which is expected this week.

Throughout the closely watched trial, Holmes’ team has sought to cast blame away from her and onto her former business partner and lover Ramesh “Sunny” Balwani.

Last week, Holmes cried on the stand in her own defense as she accused Balwani of manipulating her and completely controlling her life through emotional and physical abuse that included forced sex.

“He would force me to have sex with him when I didn’t want to because he would say that he wanted me to know he still loved me,” Holmes told the jury, sobbing.

Balwani has disputed the allegations and is being tried separately for Theranos-related fraud charges. He’s set to be tried next year.

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