Elizabeth Holmes gets emotional under fire by prosecutors

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One-time entrepreneur Elizabeth Holmes on Tuesday struggled to recall the major events that led to her being accused of fraud as the CEO of the failed blood testing startup Theranos.

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San Jose, Calif. — One-time entrepreneur Elizabeth Holmes, under questioning by prosecutors, struggled Tuesday to recall the key events that led her to allegedly commit criminal fraud to extort investors and customers of her failed blood-testing startup Theranos faced charges.

Her cross-examination began the day she shared painful memories of alleged abuse by her ex-boyfriend and business partner Sunny Balwani.

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Amidst bouts of hazy memories, Holmes cried at the witness stand when federal prosecutors questioned her to read aloud some of the erotic texts she and Balwani had exchanged during the five-year period when they drove to Theranos. were living and secretly together in a romantic relationship.

“You are God’s tigress and warrior. You are extraordinary,” Balwani pointed to Holmes in 2015 documents displayed in court on Tuesday. Holmes quickly responded with this text: “My coming from the tiger means the whole universe to me.”

Paying attention to old texts, Holmes occasionally shed tears and wiped his nose with a tissue. The jury watched and heard with a packed courtroom, which included a man who trained a pair of binoculars on Holmes from the back row

The drama unfolded on the day when Holmes revealed himself to be a victim of Balwani’s abusive and controlling behavior while they were romantically involved from 2005 to 2016. Balwani, 56, also served as Theranos’ chief operating officer from 2009 to 2016, while Holmes, 37, was. CEO and controlling shareholder.

As part of her testimony, Holmes said she was raped at Stanford—a traumatic experience that she claimed Balwani exploited to control everything from her diet to their friendships.

Both Holmes and Balvani are now fighting criminal charges for convincing investors and patients that Theranos has invented a device that can scan for hundreds of potential health problems with just a few drops of blood. After raising nearly $1 billion, Theranos collapsed amid revelations that the revolutionary technology it was using was horribly flawed.

Holmes’ trial, which began in early September, is now nearing its climax. Balwani, who is facing trial separately, is expected to face the court early next year.

Although Holmes has been on the stand since November 19, Tuesday provided her first opportunity to be sworn in for federal prosecutors.

Public prosecutor Robert Leach, who faced Holmes, did not touch on Holmes’ alleged rape, nor on his testimony about Balwani, sometimes in profane terms. Instead, she used the roughly 12,000 texts sent between Holmes and Balwani to counter her argument that they had a relationship that was more toxic than romantic.

At one point, Leach asked Holmes if she would be surprised if the word “love” appeared 594 times and the word “love” was used 105 times in texts obtained by the government. “No,” said Holmes with a slight smile.

But Holmes answered “I don’t remember” and “I don’t know” to Leach’s questions about important events in the startup’s history. She claimed to have forgotten so often that Leach uttered the phrase “let’s see if I can refresh your memory” a common practice as he presented her with document after document relating to the allegations of fraud.

Leach seemed intent on proving that Holmes knew she was making false statements to investors and Walgreens, which briefly used Theranos blood test at its pharmacies.

Holmes’s apparent forgetfulness contrasted sharply with the apparent memory of her conversations with Balvani – some of them dating for more than a decade.

But it seems that he also reflected on his behavior in Theranos. She expressed regret for the way she responded to the concerns of two former employees and their efforts to block the 2015 publication of the Wall Street Journal, which helped lead to Theranos’ downfall.

“I couldn’t say more strongly that the way we handled the Wall Street Journal process was a total disaster. We really messed up,” Holmes said.

John Carrerou, a reporter who wrote a Wall Street Journal story and a book about the rise and fall of Theranos, sat in the back of the courtroom during the moment of Holmes’ miscarriage, while taking notes for a podcast he was doing about the trial. Were were

Holmes also acknowledged that she was too quick to dismiss warnings from two former employees, Erica Cheung and Tyler Schultz, who pointed out that Theranos’ blood testing device – called the Edison – was giving false results that patients could put his health at risk.

“I sure as hell wish we treated him differently and listened to him,” said Holmes of Cheung, ending his complaints that Cheung was being ignored after leaving Theranos.

Schultz, the grandson of former US Secretary of State and Theranos board member George Schultz, also resigned from Theranos in 2015 under similar circumstances.

Cheung and Schultz both became whistleblowers and provided information for their journal story to Carrierou. After finding out that Cheung and Schultz were talking to Carrerou, Theranos’ attorney David Bois sent letters to both of them threatening to sue. Holmes insisted Tuesday that she was trying to protect trade secrets.

The strategy soured Holmes’ relationship with George Schultz, who initially supported him even after his grandson raised the alarm about Theranos’ technology.

George Schultz, who died earlier this year, became fed up with Theranos in May 2015 after lawyers sent him to pressure Tyler to sign non-disclosure documents at his home, prompting him to call Holmes. Inspired to call and complain that it was “one of the worst things I’ve ever seen anyone do,” according to Leach.

Holmes told Leach that he did not remember exactly what George Schultz said during that conversation. “I remember George was furious,” she said.

If found guilty, Holmes could face up to 20 years in prison.


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