On Thursday, former Theranos founder Elizabeth Holmes returned to the witness stand at her fraud trial and, for the first time, had her personal tax returns reviewed. During questions, two federal appeals court judges asked Holmes and her team of experts several questions that implied they believed she engaged in fraud. On Tuesday, the embattled founder and CEO of Theranos gave a rebuttal statement about the first trial.
There are two distinct phases to this case: the first is a fraud trial and the second is the upcoming verdict. The fraud trial lasted a mere three days. It began in October 2017 and focused on Holmes and her team’s argument that Theranos continued to secretly develop new and unique health technologies that could help improve medical outcomes while misleading investors. Shortly after the court heard testimony from four of Holmes’s former colleagues, an executive in charge of Theranos’s test operations conceded that the company had lied to investors about its capabilities, and more damningly, that there were no health benefits to Theranos’s blood-testing machines.
The jury found Holmes guilty of misstatements in a case that resulted in some $500 million in fraudulent losses. Holmes was also ordered to pay more than $500,000 in fines. Her defense team recently filed a notice of appeal of that ruling. In other words, the case is going to the District Court, which could grant Holmes a lighter punishment. If it does, the matter will go to the Federal Circuit, which could make Holmes serve at least 10 years in prison. In the meantime, we’ll see the saga continue.