Theranos founder Elizabeth Holmes is not a villain but rather a hard-working businesswoman whose company failed, her lawyer told jurors on Wednesday at the former Silicon Valley star's trial on federal fraud charges arising from her actions at the now-defunct blood-testing startup once valued at $9 billion.
Lance Wade, a lawyer for Holmes, began the defense's opening statement in one of the most closely watched trials of a U.S. corporate executive in years. Wade spoke after the prosecution in its opening statement to the jury said Holmes had engaged in "lying and cheating" to attain wealth and fame.
Holmes is accused of making false claims about the company, including that its devices designed to draw a drop of blood from a finger prick could run a range of tests more quickly and accurately than conventional laboratory means.
"Elizabeth Holmes did not go to work every day intending to lie, cheat and steal. The government would have you believe her company, her entire life, is a fraud. That is wrong. That is not true," Wade said in the courtroom in San Jose, California.
"In the end, Theranos failed and Ms. Holmes walked away with nothing," Wade added. "But failure is not a crime. Trying your hardest and coming up short is not a crime. And by the time this trial is over, you will see that the villain the government just presented is actually a living, breathing human being who did her very best each and every day. And she is innocent."
Holmes, 37, has pleaded not guilty to 10 counts of wire fraud and two counts of conspiracy.
"This is a case about fraud - about lying and cheating to get money," Robert Leach, a member of the prosecution team, earlier told jurors.
Her alleged scheme made her a billionaire, Leach told jurors.
"The scheme brought her fame, it brought her honor and it brought her adoration," Leach added.
"She had become, as she sought, one of the most celebrated CEOs in Silicon Valley and the world. But under the facade of Theranos' success there were significant problems brewing," Leach said.
Holmes sat at a table flanked by her attorneys, Kevin Downey and Lance Wade. She earlier arrived at the courtroom, wearing a white blouse and grayish-blue skirt suit, with a facemask amid the COVID-19 pandemic.
The trial is being presided over by U.S. District Judge Edward Davila, with a 12-member jury along with five alternate jurors.
Former Theranos executive Ramesh "Sunny" Balwani, scheduled to be tried separately, has also pleaded not guilty.
Leach told jurors the evidence will show that Holmes agreed with Balwani to carry out a scheme to defraud Theranos investors and patients, executed through a number of false and misleading claims.
In 2009, after losing interest from Pfizer Inc and other pharmaceutical companies, Holmes turned to fraud, Leach said.
"Out of time and out of money, Elizabeth Holmes decided to lie," Leach said.
Prosecutors have said Holmes and Balwani defrauded investors between 2010 and 2015 and deceived patients when the company began making its tests commercially available, including via a partnership with the Walgreens drugstore chain.
"It was not doing anything that could not be done in an ordinary central blood testing laboratory," Leach said of Theranos.
On screens mounted in front of their seats, Leach showed jurors excerpts of a Theranos presentation to investors claiming its process provided the "highest levels of accuracy and precision."
In truth, Leach said, insiders knew the technology was "plagued by issues and repeatedly failing quality control."
Leach laid out several ways in which Holmes allegedly defrauded investors, including by suggesting that the company's miniature lab had been vetted by Pfizer, that its technology was being used by the U.S. military in the field, and that it would achieve more than $140 million in revenue by the end of 2014, which he called "nowhere near achieving."
Court filings unsealed last month showed that Holmes, who had been in a romantic relationship with Balwani, has alleged that he abused her emotionally and psychologically. Balwani has denied the allegations.
Holmes' attorneys have said in court papers she is "highly likely" to take the witness stand and testify about how the relationship affected her mental state. Defendants rarely testify at their own trials because it opens them up to potentially risky cross examination by prosecutors.
A Stanford University dropout who started Theranos in 2003 at age 19, Holmes once grabbed headlines with her vision of a small machine that could run blood tests in stores and homes.
The Wall Street Journal in 2015 reported that the Theranos devices were flawed and inaccurate, setting off a downward spiral for a company that had drawn investors including media mogul Rupert Murdoch and Oracle co-founder Larry Ellison.
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