Disgraced Girlboss Elizabeth Holmes Is Finally Standing Trial for Fraud

Court filings suggest that Holmes may defend herself by accusing her former romantic and professional partner at Theranos of abuse.
Elizabeth Holmes, founder and CEO of Theranos, speaks at the Clinton Global Initiative's closing session on September 29, 2015 in New York City.
Elizabeth Holmes, founder and CEO of Theranos, speaks at the Clinton Global Initiative's closing session on September 29, 2015 in New York City. (Photo by Andrew Burton/Getty Images)

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Nearly two decades after Elizabeth Holmes dropped out of Stanford University on a promise to revolutionize health care, the onetime girlboss is standing trial in California over accusations that her company, Theranos, was built on fraud.

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Jury selection starts Tuesday in Holmes’ San Jose trial, as the founder of the blood-testing startup faces 12 charges, including 10 counts of wire fraud and two of conspiracy to commit wire fraud. The trial, expected to last months, has been long delayed thanks to the coronavirus pandemic and the birth of Holmes’ first child. 

It’s also the culmination of a startling fall from grace: After Holmes left Stanford at 19, she was hailed as a visionary for Theranos’ purported development of technology that could run a range of laboratory tests using just a few drops of blood. Holmes’ net worth numbered in the billions and she graced magazine covers wearing a Steve Jobs-ian black turtleneck. Esteemed men like Henry Kissinger and James Mattis served on Theranos’ board. 

Then, in 2015, reporting by the Wall Street Journal started casting doubt on whether Theranos’ technology really worked as well as the company claimed. In 2016, Forbes dropped its valuation of Holmes’ fortune from $4.5 billion to nothing. In 2018, the Securities and Exchange Commission charged Holmes and Theranos’ former President Ramesh "Sunny" Balwani—who was, for a time, romantically involved with Holmes—with raising more than $700 million from investors “through an elaborate, yearslong fraud in which they exaggerated or made false statements about the company's technology, business, and financial performance,” according to an SEC press release.

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Holmes and Balwani settled the SEC’s fraud charges against them without admitting guilt. By the end of the year, Theranos had shut down—and Holmes and Balwani had been indicted

They’ve both pleaded not guilty, although their cases have since been separated. That could be key for Holmes, since court filings unsealed over the weekend suggest that Holmes plans to defend herself by accusing Balwani of emotionally and psychologically abusing her, to the point that the older man controlled her. One filing by Balwani’s legal team indicates that Holmes plans to accuse Balwani of monitoring her communications, throwing “hard, sharp objects” at her, and restricting her sleep.

“This pattern of abuse and coercive control continued over the approximately decade-long duration of Ms. Holmes and Mr. Balwani’s relationship, including during the period of the charged conspiracies,” one document from Holmes’ legal team alleges. 

In court documents, Balwani has denied ever abusing Holmes. 

The case is expected to serve as a kind of commentary on Silicon Valley’s much-heralded “fake it till you make it” culture—a potentially dangerous ethos to perpetuate when the “making it” involves people’s health. 

“If she's convicted, I expect it to be a wake-up call in Silicon Valley to how much you can exaggerate, how much you can lie, how much you can experiment with your products before you cross that bright red line before you have to go to prison,” John Carreyrou, the former Wall Street Journal reporter who broke the Theranos story, told NPR.

If convicted, Holmes could face up to 20 years behind bars.