After seven days, Elizabeth Holmes was her own final witness in her defense against federal fraud charges tied to her failed blood-testing startup as testimony concluded Wednesday in the Theranos trial.
Wearing a royal blue dress and a black blazer, Holmes, Theranos' disgraced former CEO, parried with prosecutors, saying with crisp responses and occasional smiles and head tilts toward the prosecutor that she believed her misstatements at the time she made them and had no intention to deceive anyone.
In one of her final remarks on the witness stand, Holmes said that what she had told investors over the years had always been in the future tense.
“I wanted to convey the impact the company could make and how it could change health care,” she said. “I wanted to talk about what this company could do a year from now, five years from now, 10 years from now.”
During cross-examination, Holmes, 37, tried to deflect prosecutors' attempts to contradict her previous testimony. Repeatedly she said that when she made misstatements to investors and business partners, she believed them at the time. In other instances, she struggled to remember specifics about misstatements she made.
Five witnesses have said Holmes led them to believe that the Theranos technology was being used on military helicopters.
“You were here for Bird, Peterson, Grossman, Parloff and Brian Tolbert,” prosecutor Robert Leach said, referring to the investors, business partners and a reporter who testified and whom she is alleged to have misled. “But your testimony is that you didn’t tell anyone that Theranos devices were on any medevacs?”
“I don’t think I did,” Holmes said.
Leach confirmed with Holmes that she never told Fortune reporter Roger Parloff — who wrote a glowing cover profile of Holmes in 2014, which was later retracted — that the company was running tests on third-party machines instead of its own proprietary, and malfunctioning, devices.
“At the time, you were not worried people would be given an inaccurate impression?” he asked.
“I was not,” Holmes said.
Evidence was displayed on digital monitors during the trial, one in front of each juror and two mounted to face the public.
Leach presented a line from the article on jurors’ screens that read: “It currently 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.”
Asked whether she would agree that the statement in the 2014 was incorrect, Holmes replied, “I believe that now.”
Holmes also claimed not to remember having sent the article to investors. Prosecutors then showed jurors an email indicating that she had.
Legal experts say Holmes’ claims to have believed in her misstatements when she made them are meant to show that she was not deliberately scheming to take money from investors.
“It goes directly to ‘no intent to defraud’” as a defense argument, said Ellen Kreitzberg, a law professor at Santa Clara University.
“The government can prove the statements were material misstatements in many cases. But they have to have been made with the intent to defraud for her to be guilty,” she said.
Defense attorney Kevin Downey underscored those points Wednesday in an exchange with Holmes.
“Did you ever take steps to mislead people who invested in Theranos?” Downey asked.
“No,” Holmes said.
“Do you recognize that they lost money?”
“I do,” she replied.
“Was that a result of your attempting to mislead them?” Downey asked.
“Of course not,” Holmes said.
He also had Holmes confirm that she never sold a single share in the company, that she relied on company scientists and engineers to verify technological capabilities and that many lab decisions she was unaware of were made by Ramesh “Sunny” Balwani, her former partner, chief operating officer and co-defendant.
The dry testimony stood in contrast to the emotional recollections Holmes gave alleging mental and sexual abuse by Balwani, who has strongly rejected the claims.
Government lawyers moved later to strike that part of her testimony, saying some of the events Holmes spoke to were not relevant to the case because the defense did not call an expert witness to explain the psychological damage she recounted.
Holmes and Balwani face 11 charges of fraud connected to the blood-testing startup Theranos. Holmes founded the company when she was 19, dropping out of Stanford to pursue her vision of a micro-fluidic, finger prick blood-testing system that could diagnose more quickly and cheaply than conventional venous draws used by large vendors like Quest Diagnostics and Labcorp.
At its peak in 2014, 11 years after its launch, the company was valued at $9 billion and Holmes personally at $4 billion, making her the world’s youngest female self-made billionaire, spreading her story across glossy business magazines and attracting iconic investors and former Cabinet members to her board of directors.
But the success story began to fray after The Wall Street Journal published a series of skeptical articles in 2015 and 2016 revealing that the company had been running tests on other companies’ equipment instead of its own, tightly guarded devices and was experiencing quality control issues. Failed government lab inspections and investor lawsuits followed.
Despite an internal cleanup and reorganization effort, the company shut down in 2018. Holmes and Balwani that year settled a lawsuit filed by the Securities and Exchange Commission, and the Justice Department filed criminal charges against them.
After testimony ended Wednesday, U.S. District Judge Edward Davila canceled hearings scheduled for the rest of the week and set Dec. 16 to begin closing arguments.