(CN) — Attorneys for Elizabeth Holmes acknowledged the disgraced former CEO of the blood-testing company Theranos made mistakes in her role as the leader of the Silicon Valley company but did not commit fraud as accused by the federal government.
The high-profile trial unfolding at the federal courthouse in San Jose, California, the heart of Silicon Valley, featured the prosecution unfolding many of the well-known allegations regarding Holmes' period as CEO — including faking documents from large pharmaceutical companies that attested to the efficacy of the miniature blood-testing machine she supposedly pioneered and using competitors' blood-testing equipment to carry out tests ostensibly performed by Theranos' innovative technology
But many watching the trial were more interested in how the defense team would counter the charges that have circulated in the press for the past five years.
“Failure is not the same thing as fraud,” said Lance Wade, attorney for Holmes. “The evidence will show you that Elizabeth Holmes did not commit crimes. Instead, she devoted her life and her work to this company and its mission.”
Wade noted that Holmes started the company when she was 19 years old with her college savings after dropping out of Stanford University and worked tirelessly, often seven days a week, to build a company that employed hundreds of people at its peak to offer more and better testing to patients.
“The government has presented the events of this company through a dirty lens,” Wade said. “They have pointed to select facts to portray the company unfavorably and portray Miss Holmes as the villain.”
The defense said they will provide the context to show Holmes may have made mistakes out of naivete, but only in the interest of serving her company. She owned shares worth billions of dollars when the company was at its peak and never sold a single one — hardly the act of a fraudster looking to get rich quick, Wade said.
“If she intended to defraud incredibly wealthy investors, don’t you think she might sell some of her stock to take advantage, to try to cash in,” he asked the jury.
Holmes sat in a packed courtroom in San Jose on Wednesday, dressed in a dark gray suit and a white blouse. She made no visible gestures during the morning portion of a trial that is expected to last four months.
She also donned a blue surgical mask required as a condition of in-person attendance at the federal courtroom. Her attorneys have expressed a preference that she not wear a mask as they will attempt to humanize Holmes as a hardworking female CEO who made mistakes and was at times led astray by her more seasoned business partner Sunny Balwani, whom she met when she was 18 and he was 37.
“Trusting and relying on Mr. Balwani as her primary adviser was one of her mistakes,” Wade said.
In his opening arguments, U.S. Attorney Robert Leach also acknowledged Holmes was a dedicated CEO who spent countless hours in the office grinding to get her company ahead of the competition. But he said it was that determination that caused her to cheat once it became clear that the walls were closing in and the technology she invested in did not work.
“Out of time and out of money, Elizabeth Holmes decided to lie,” Leach told the jury.
In 2010, as Holmes and Balwani were calling the bank to make sure they could cash a check to meet payroll, they met with Safeway and Walgreens and claimed a miniature blood analyzer could conduct a vast array of blood tests with a single prick of blood from a finger.