Opening statements in the case of Elizabeth Holmes, the founder of the blood testing start-up Theranos, began in San Jose, Calif., on Wednesday morning, kicking off one of Silicon Valley’s most anticipated trials.
“This is a case about fraud and about lying and cheating to get money,” said Robert Leach, an assistant U.S. attorney for the Northern District of California, who is leading the prosecution for the government.
Ms. Holmes, 37, has been charged with 12 counts of wire fraud and conspiracy to commit wire fraud in connection with money she raised for Theranos, which dissolved in 2018 after its blood tests were revealed to have problems.
Lance Wade, Ms. Holmes’s lawyer, painted a dramatic picture of a passionate entrepreneur who may have failed but was not a criminal.
“Elizabeth Holmes,” Mr. Wade said in his opening statement, pausing for effect, “worked herself to the bone for 15 years trying to make lab testing cheaper and more accessible.”
“The villain the government just presented is actually a living breathing human being who did her very best each and every day,” he added.
A jury will decide whether Ms. Holmes, who founded Theranos in 2003 and hawked a mission of revolutionizing health care, lied to investors about her company’s technology.
Ms. Holmes claimed Theranos’s machines, called Edison, could quickly conduct a wide range of blood tests using just a drop of blood. The United States has accused Ms. Holmes of knowing that the tests were limited and unreliable, harming patients who used them. Prosecutors also said she overstated Theranos’s business deals and performance.
Theranos’s former president, Ramesh Balwani, known as Sunny, is being tried in a separate case set to begin next year. Both Ms. Holmes and Mr. Balwani have pleaded not guilty. Judge Edward Davila of the U.S. District Court for the Northern District of California is presiding over the cases.
If convicted, Ms. Holmes could face up to 20 years in jail, which would make her one of the few Silicon Valley executives accused of wrongdoing to go to jail.
The trial caps years of delays and legal squabbles over things like which emails and arguments can be used and whether Ms. Holmes should be required to wear a mask while sitting in the courtroom.
Last week, a jury of seven men and five women was sworn in after the elimination of many potential jurors who had either heard of Ms. Holmes, had direct experience with domestic abuse or had schedules that could not accommodate the three-month trial.
Ms. Holmes’s lawyers have indicated that they may use a mental health defense, arguing that Mr. Balwani, whom she dated, was emotionally and physically abusive. Mr. Balwani has denied the accusations. Ms. Holmes’s lawyers have also indicated in court filings that she is likely to take the stand.
In court documents filed over the weekend, prosecutors listed more than 200 potential witnesses including David Boies, Theranos’s former lawyer; Henry Kissinger, the former secretary of state who sat on Theranos’s board; James Mattis, the former defense secretary and a Theranos director; and Rupert Murdoch, the media mogul, who backed Theranos and was part of a lawsuit over its demise. Some names were displayed as initials.
Ms. Holmes’s lawyers listed more than 60 witnesses, including several of the U.S. attorneys on the case; John Carreyrou, a reporter and the author of a book about Theranos; William Frist, the former U.S. Senator who sat on the Theranos board; and Ms. Holmes.
In a separate filing, lawyers for Ms. Holmes also asked that testimony from three former Theranos employees be excluded. One of the witnesses, Erika Cheung, worked in Theranos’s lab and reported problems with its blood testing to federal regulators. Ms. Holmes’s lawyers argued that various parts of Ms. Cheung’s testimony would be irrelevant, based on hearsay or not directly connected to Ms. Holmes.
Ms. Holmes’s lawyers also asked to exclude testimony from Daniel Edlin, a former project manager at the company, and Danise Yam, Theranos’s corporate controller for 11 years.
Prosecutors responded with exhibits backing up Ms. Cheung’s claims. On Tuesday, Judge Davila ordered that such an exclusion would be “premature” ahead of hearing the government’s questions or argument.