JUDY WOODRUFF: Elizabeth Holmes,
the founder of the former health
technology company Theranos,
faced cross-examination today for the
first time in the fraud case against her.
Federal prosecutors have called
29 witnesses over 11 weeks,
in an attempt to reveal the
alleged deception that led investors
and patients to believe the company
could conduct a range of tests
using just a few drops of blood.
The start-up collapsed in 2018.
Rebecca Jarvis is the
chief business, technology,
and economics correspondent for ABC
News and the host of "The Dropout,"
a podcast about Holmes and the ongoing
trial, which is being held in San Jose.
Rebecca Jarvis, thank you
very much for being with us.
The defense has only begun
its side. The prosecution has
spent, what, almost two months
making this case or even longer.
If you can, sum up what the
prosecution was trying to do.
REBECCA JARVIS, ABC News:
Well, Judy, the prosecution has
shown now in meticulous detail
their allegations that Elizabeth Holmes
was the one in charge of her company,
Theranos, that she's the reason investors,
patients and doctors were defrauded here.
And they have shown us individuals,
including investors, patients.
We have heard from doctors.
We have heard from scientists inside
the company. We have heard from
scientists outside the company,
in meticulous detail, laying out
this fraud and putting Elizabeth
Holmes at the front of it.
JUDY WOODRUFF: And she has just,
as we said, taken the stand,
I guess just before Thanksgiving.
She's only - - we have only
heard from her for a few days,
but it's been dramatic, including her
discussing being raped in college.
Give us a sense of what she's
saying and what the reaction's been.
REBECCA JARVIS: Well, Judy, this
has been explosive testimony.
We have barely heard from Elizabeth Holmes
since the charges were first brought and,
frankly, have never heard some of the
things she's been saying on the stand,
and seen here in the way she's
behaved on the stand, getting
emotional, talking about,
as you mentioned, being raped as a
college student at Stanford, that
being, according to her, one of
the reasons she decided to drop
out of Stanford and begin her
blood testing company, Theranos.
And she's also raised these
allegations which we thought might
come up at this trial against her
former boyfriend and COO, Sunny
Balwani, alleging years of abuse
in the relationship, alleging
it was emotional, it was physical,
he dictated everything from her
schedule to way that she ate.
Now, these are claims he has denied
vociferously. But these are claims
that she raised. And they are
something that certainly the
jurors now are going to have
to think about as they think
about the bigger picture question, which
is, did this woman intend to commit fraud?
JUDY WOODRUFF: And what I have
read, Rebecca, is that she's
walking this fine line, because,
on the one hand, she's saying
she was heavily influenced by him
over a period of time, but then
she's now saying that he was not
the reason she made these decisions
as the head of the company.
REBECCA JARVIS: Well, and that's a really
important point that you raised, Judy,
because she was asked point blank
by her own attorney, did Sunny
Balwani dictate what you said
to investors? Did he dictate
what you shared with Walgreens,
your biggest customer, Walgreens
being the place, the one place
where Theranos tests got in front
of patients in this country?
So she said point blank, no, that he
was not a part of those decisions.
That is the fraud here. The fraud is not
about the rest of these conversations and
allegations, though they might make
the jury feel more connected to her.
Of course, they have sat in front
of her now for many weeks. She's
been there in the trial with
her family sitting behind her,
her partner. They have been
told that she's a new mom,
she has a newborn baby. And so
they have really seen this woman
for an extended span of time.
JUDY WOODRUFF: And, Rebecca, of course,
whatever the jury decides will have
an enormous impact on her. She
could face up to 20 years in prison.
But it's also seen as a case important
for the future of Silicon Valley. How so?
REBECCA JARVIS: Well, it
raises these questions about
faking it until you make it.
There are definitely people who believe
that this is endemic to Silicon Valley,
that this is the way people behave in
Silicon Valley. And then there are those
who think this is absolutely
not the case. The bottom line
here is, this is a woman who
was able to raise more money
than almost any other female
founder. She became one of the
wealthiest self-made women in
the world. At one point, her
company was worth $9 billion.
So it does raise these questions
about how -- what standards we
hold founders to. What is important
when a device like a blood
testing device gets in front of
anybody at a Walgreens store?
JUDY WOODRUFF: And, finally, any sense of
what we can expect next from the defense?
REBECCA JARVIS: Well, we
have certainly now heard this
cross-examination today from the
prosecution. And they have raised a number
of text exchanges between Elizabeth Holmes
and her former boyfriend
and COO, Sunny Balwani.
The defense is going to have to come back
strong here, because the prosecution has
presented a lot of very important evidence
that really links -- especially today,
that really links Elizabeth Holmes
directly to the allegations of fraud.
JUDY WOODRUFF: Rebecca Jarvis
watching this riveting trial.
Thank you very much,
Rebecca. We appreciate it.
REBECCA JARVIS: Thank you, Judy.