Elizabeth Holmes is facing trial again — with allegations that she misled investors and regulators while building up an industry-leading, then doomed, DNA-testing company.
The Federal Bureau of Investigation conducted a federal investigation into Holmes, the charismatic founder of Theranos and parent company Theranos, after an all-expenses-paid Hawaiian trip that she took with a group of investors as well as the start of a criminal investigation into whether Holmes had violated securities laws. The U.S. attorney’s office in Northern California announced Wednesday that the companies “are no longer cooperating with the government’s investigation” — although “a small percentage” of the case still has to be resolved.
Based on court documents obtained by Bloomberg, Holmes rested her case during the two-week trial after a daylong cross-examination by Daniel Vaughn, a defense attorney for John Carreyrou, the Pulitzer Prize-winning reporter at Bloomberg. The jury will now hear for a second day from Katherine Kuczmarski, a lawyer for William Welch III, an early Theranos investor who has accused Holmes of defrauding investors.
Why did this trial take so long?
A lot of bad things could have happened, given the nature of the case, and when the jury came in the first day, they were confused and had concerns about how to think. They could have picked a narrow view that would then require them to go back and look at what has already been presented. The judge recognized that, so during closing arguments, they took an alternate view and it was a lot easier on the jury.
How is Holmes’ credibility at issue?
She was always the face of the company, but she couldn’t take any responsibility for anything. One of the accusations is that the company was beginning to fail before she left the company in 2018. There was still a report she could have used to confirm the company was in a mess, and she didn’t take that one.
The case has been delayed so much, what is the toughest question the jury will have to sort out?
The jury can determine that either Holmes is guilty or she wasn’t. But because the government is saying she’s guilty, the jury will have to decide on whether or not she had the intent to defraud the public.
The defense can put in more witnesses. The timing on this will depend on when the government gets finished with their work.
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