- Elizabeth Holmes took the stand to testify on the third day at her criminal fraud trial.
- Holmes admitted that he added the Pfizer and Schering-Plow logos to a lab report, telling jurors “I wish I had done it differently.”
- Holmes said she spoke to board members, including Generals James Mattis and Henry Kissinger, about the trade secrets.
San Jose, Calif. — In a surprising confession, Elizabeth Holmes admitted that she was the one who put the giant drugmakers’ logos on the Theranos Lab report, but insisted they didn’t mean to defraud investors or business partners.
Dressed in a dark green dress and black blazer, Holmes told the jury from the witness stand, “I wish I had done it differently.” Testifying on his third day, Holmes gave a direct answer to the key allegations in the government’s case against him.
Federal prosecutors claim that Holmes partially defrauded investors by using unauthorized due diligence reports from Pfizer and Schering-Plough, whose company logos were on the documents. Juries are repeatedly shown Theranos reports that Holmes had sent Walgreens executives with the logo. Witnesses from the drug companies testified that they never authorized the use of the logo.
Holmes said she was the one who added the logo to the report “because it was done in partnership with those companies and that’s what I was trying to convey,” she said. But Holmes claimed it was not to send a false message that the companies produced the lab reports.
“Did you intend to give that impression?” Holmes’ attorney Kevin Downey asked.
“No, but I have heard that testimony in this case and I wish I had done it differently,” Holmes said.
“Did you try to hide from Pfizer that you added the Pfizer logo to the top of the report you sent to Walgreens in 2010?” Downey asked.
“Not at all,” said Holmes.
Holmes said an initial goal for Theranos was to partner with retail giants, adding that she reached “all of them” including Target, CVS, Walmart, Walgreens and Safeway.
Walgreens became a major partner for Theranos, launching a wellness center inside its 40 stores in Arizona. However, Walgreens terminated its partnership with the start-up in 2016 and sued the company for breach of contract.
For the first time on the stands, the jury hears Holmes mention the name of his top executive and sometime romantic partner, Ramesh “Sunny” Balwani. Holmes testified that Balwani, along with some attorneys, were involved in negotiations with Walgreens.
In an effort to refute another significant allegation, Holmes spoke of using third-party equipment to test a patient’s blood. She testified that Theranos turned to modified equipment as a workaround because there were too many samples for her lab to handle.
In addition, Holmes told the jury that Theranos did not disclose this information to investors or business partners because they believed it was intellectual information.
“It was an invention that we understood from our attorney that we would have to protect as a trade secret and if we disclosed that trade secret,” Holmes said. “The advice was to keep it a secret so that Theranos would have a chance to profit from that invention.”
Holmes admitted that she was fully aware of the challenges inside the lab.
“It’s the numbers, there are always challenges,” Holmes told the jury. “We were working relentlessly to make sure we had the right components in the device to handle all the tests that would eventually become the test list for retail.”
Holmes also spoke about the information he shared with his board of directors, which included former Defense Secretary James Mattis, former Secretary of State Henry Kissinger, former Wells Fargo CEO Richard Kovacevich and Senator Sam Nunn.
Downey asked Holmes to walk the jury through the October 2013 meeting.
“I remember talking to board members and asking for advice on how we set up this business to be a success over the long term,” Holmes said. “What should I focus on internally to make this happen.”
Holmes said his board members were paid $150,000 per year in addition to receiving 500,000 shares in Theranos. According to Holmes, Henry Kissinger was paid a further $500,000 in consultation fees.
“We were sharing with the board that we had these trade secret inventions that we thought were a big deal and that we needed to protect,” Holmes said, “while discussing with the board.” whether this invention should really be treated as a business.” Secret.”
Holmes was met by a sea of camera crew upon arrival at the courtyard on Tuesday, and an onlooker was repeatedly shouting “God bless you, girl boss” as she walked in.
Early in the morning, as journalist and member of the public Robert F. As they began to line up outside the Peckham Federal Building, an onlooker came with a blonde wig, black turtleneck, red lipstick and a suitcase filled with “blood energy drinks.”
Artist Danielle Baskin was selling Holmes costumes before security informed her that she could not sell merchandise on federal property. Baskin said she is not a supporter of Holmes, but wants to come to trial and “see what it would be like to experience her energy.”