Trial of Former Tech Darling Elizabeth Holmes Set to Start This Week

Three years after Theranos officially dissolved, its founder is set to stand trial on federal fraud charges.

Jury selection in the criminal case against Elizabeth Holmes is scheduled to begin Tuesday in San Jose, California. Holmes — who rose to prominence as the turtleneck-clad, Stanford dropout behind the Silicon Valley startup marketed as being able to rapidly detect dozens of health conditions with just single drops of blood — is charged with multiple counts of wire fraud and conspiracy, and could face 20 years in prison.

Federal prosecutors have alleged that Holmes defrauded investors, physicians, and patients in leading Theranos to its former unicorn status: the company was once valued at $9 billion, with Holmes touted as the youngest self-made female billionaire.

The trial has been delayed multiple times due to the COVID-19 pandemic and, more recently, Holmes’s pregnancy. In July, Holmes gave birth to her first child, William Holmes Evans, with partner, Billy Evans. And some legal experts have said that Holmes’s status as a new mother could sway a jury in the defendant’s favor.

Last week, in the lead-up to the official jury selection process, an attorney for Holmes told the judge in the trial that about 30 potential jurors should be immediately excluded for having read a book, listened to a podcast, or watched a documentary about the collapse of Theranos. Holmes’s attorney also supported selecting only jurors who have been vaccinated against COVID-19.

Over the weekend, insight into Holmes’s potential defense strategy emerged. Along with Holmes, federal prosecutors have charged the former No. 2 executive at Theranos, Ramesh “Sunny” Balwani — with whom Holmes was previously in a romantic relationship — with fraud and conspiracy. Balwani is set to be tried separately next year, but Holmes may argue at her trial that she was in a decade-long abusive relationship with him and under his control during the time in which the alleged multi-million-dollar fraud at Theranos took place.

In recent years, Holmes, once a media darling, has remained largely out of the spotlight. Theranos — which dates back to 2003 — was first tossed into upheaval roughly 6 years ago after bombshell reporting by John Carreyrou in the Wall Street Journal, which detailed problems with the blood testing company’s technology.

In 2018, MedPage Today spoke with Carreyrou between stops on his book tour for Bad Blood: Secrets and Lies in a Silicon Valley Startup, which went beyond his initial reporting on Theranos. At the time, Carreyrou said he believed that the alleged illegal conduct by Holmes was the result of repeatedly glossing over problems and over-promising to investors, doctors, and the public, which amounted to massive fraud over time.

Ultimately, Holmes’s high-profile relationships and buy-in from the likes of the Clintons and retail giant Walgreens perpetuated Theranos’s credibility before its fall.

Federal prosecutors have claimed that Holmes engaged in a multi-million-dollar scheme to defraud investors, and a separate scheme to defraud doctors and patients. Holmes knew that the blood testing technology had “accuracy and reliability problems, performed a limited number of tests, was slower than some competing devices, and, in some respects, could not compete with existing, more conventional machines,” federal prosecutors stated.

Legal counsel for Holmes have denied any wrongdoing.

Following jury selection, opening arguments in the trial are scheduled to start September 8. Among those set to testify against Holmes are patients wrongly diagnosed by Theranos blood tests, including individuals who had been told they were HIV positive or had miscarried a baby. The trial could stretch on for months.