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Jurors reconvene Monday morning in trial of Theranos founder Elizabeth Holmes


It's been four months since Elizabeth Holmes' trial started in San Jose, Calif. The founder of the blood testing company Theranos has been charged with wire fraud and conspiracy to commit wire fraud. And if she's convicted, Holmes could go to prison for decades. Juries have deliberated for six days, and they're not due back in court until Monday morning. NPR's Bobby Allyn and Erin Griffith for The New York Times have been covering the trial, and they join us now. Hey, there.

BOBBY ALLYN, BYLINE: Hey, what's up, David?


GURA: Bobby, let me start with you. Give us a sense of where things stand. As I said, six days in, what do we know of the jury's deliberations?

ALLYN: Yeah, so the jury has been deliberating for more than 40 hours. Of course, deliberations happen in private, so we don't really know which way they're leaning or what the discussions even look like. They had just two notes so far - one asking, hey, Judge, can we bring the jury instructions home? The answer was no. And the second was to hear some recordings of Elizabeth Holmes pitching investors about Theranos, so they reheard some of that audio testimony. But beyond that, David, we just don't really know where the jury stands, other than they're still sort of hashing it out amongst themselves.

GURA: Erin, there were 20-plus witnesses called by the prosecution, painting the picture of this fraud that they say was committed. Remind us just how large it was or was alleged to be.

GRIFFITH: Theranos raised $945 million over the course of its existence. It was valued at $9 billion, and so that's a lot of money that most investors lost all of. In addition, it did, you know, assess millions of tests and ended up voiding many of those at the end of the day. And so the patients and the investors are the victims here.

GURA: Bobby, I'll turn to you to ask how Holmes defended herself in light of that, in light of the case that was presented by the prosecution.

ALLYN: Yeah, sure. So Elizabeth Holmes took the stand. And I should note here that it's a pretty controversial move for a defendant to take the witness stand in a white-collar criminal trial. It's very risky because that exposes them to cross-examination from the government. And she testified over seven days. And, you know, most of the legal experts I talked to were pretty impressed by her performance. She was very detail-oriented. She was very thorough. She took the stand and said, look, I made some mistakes. I wish I would have done some things differently. She also said her deputy at Theranos, Sunny Balwani, was responsible for a lot of the failings of the company, that lab scientists who were very close to some of the technology - you know, maybe they're the ones who are really accountable for some of the shortcomings of the technology.

And this was probably the emotional climax of the trial. She accused Balwani of emotional and sexual abuse. She was sort of weeping on the stand. And it wasn't directly stated, but the sort of implication was, you know, maybe this abuse got in the way of her state of mind during the time of the alleged crimes. But the way that they presented it, they didn't sort of, like, hammer that point home. They just put these abuse allegations out there and never really tied a bow on it. But over seven days on the stand, you know, she was contrite.

GRIFFITH: You know, the experts that I've talked to said, ultimately, this is going to come down to Holmes's testimony and how jurors feel about it. I mean, really, they have to decide this case based on whether they believe that she intended to defraud these people. And her testimony - the theme that came up over and over again was that she believed what she was saying. She believed that Theranos was either going to do the things she was saying or could already do it. That's probably what they're hung up on right now is, like, thinking about her testimony, that seven days she spent on the stand, and whether or not they believe her.

GURA: So Bobby, at the center of this is this allegation of fraud, and how difficult is that to prove?

ALLYN: So I think people who have listened to one of the podcasts about the trial or read the book on Theranos or saw the documentary on Elizabeth Holmes have one idea of her and the company. But I think one lesson that a lot of people are learning with this trial is just how high the bar is and just how many layers there are to untangle for the jury. Because, you know, proving that she did this intentionally, that we know what was happening in Elizabeth Holmes' mind when she was talking to investors is a really difficult thing to prove. And it's something that, you know, is obviously taking more than 40 hours for the jury to reach a conclusion about.

GURA: Erin, Elizabeth Holmes is the subject of such popular fascination, and there's a kind of circus-like quality to this trial, as I understand it. Just describe what it's been like for you to cover this day in and day out over the course of four months.

GRIFFITH: Well, first of all, I almost feel like I shouldn't have - like, we were kind of, like, shooting ourselves in the foot by writing about how crazy it was, because I think that might have attracted more spectators to come and line up, you know, at 3 or 4 in the morning to get into this trial just to see what all the buzz was about. Because that just meant that we had to get there as journalists trying to get one of these 34 seats in this courtroom even earlier. And so it's attracted all kinds of people who are just kind of curious about this. They view the trial as perhaps a piece of history. They've listened to the podcast, perhaps, or they've watched the documentary, read the book "Bad Blood." There's even been some book clubs that have shown up. There's been this sort of wild vibe, and when Holmes walks in every day around 8, you know, she's surrounded by cameras, sometimes people are yelling things. That itself has turned into as much of a story as what's actually happening inside the courtroom.

ALLYN: And so the reporters who are waiting around, you know, to get into the court are now waiting on deliberations, have entertained themselves in many different ways. In fact, there was one reporter, a reporter for The Guardian, Kari Paul, who brought tarot cards. And we've been asking the tarot cards, is there going to be a verdict? Is she guilty? So we've been able to try to have some fun as we're all waiting around on the results of this trial.

GURA: Erin, I want to ask you how this - the spectacular rise and collapse of Theranos - has changed the way Silicon Valley operates. You've been covering it for some time now. Has it changed the culture?

GRIFFITH: I mean, I think one thing that it has changed since, you know, 2015, when John Carreyrou at the Wall Street Journal wrote that expose about Theranos' claims - I think it has changed the way the media covers technology companies because, you know, there was a big role that the media played in holding her up, putting her on those magazine covers and not necessarily digging into the claims, just really wanting to believe them, that, you know, she was this prodigy. And so there was a reckoning among the media. It was like, OK, we need to look at tech more critically. And so that has certainly changed. And that has led to a more combative relationship between the tech industry, which is used to having these glowing profiles written about how they're changing the world for the good, and the media, who's now, you know, looking for more accountability and more critically at these companies.

So that has certainly changed. But the money, the lack of due diligence, the hype and the sort of, you know, crazy frenzy around these Silicon Valley unicorns - that has not changed. That, if anything, has gotten more crazy. And we've seen that, you know, the pandemic has supercharged the growth of a lot of these tech companies, and there are investors who are just chasing growth because the stock market is still going crazy. They're dumping money into these companies. And the diligence, I don't think, has gotten any more strict. And that is kind of what really, like, hurt the investors who invested in Theranos without doing their diligence.

GURA: Bobby, how about the trial? I wonder how closely Silicon Valley is paying attention to what's gone on over the last four months and what the verdict is going to be.

ALLYN: Yeah, I mean, I think most in Silicon Valley who had anything to do with Theranos have distanced themselves from the company long ago. Also, some of the biggest checks that Theranos got from, you know, Rupert Murdoch, from Betsy DeVos, from the Walton family - these are, you know, billionaires who have nothing to do with Silicon Valley, right? So people have some ambient awareness that this is going on, but whether or not this is like a referendum on Silicon Valley or whether the outcome is going to have some outsized influence on the culture of the fake-it-till-you-make-it culture of Silicon Valley - I think some of, you know, those predictions are overblown.

GURA: NPR's Bobby Allyn and Erin Griffith of The New York Times, thanks to you both.


ALLYN: Thanks, David.

(SOUNDBITE OF MUSIC) Transcript provided by NPR, Copyright NPR.

David Gura
Based in New York, David Gura is a correspondent on NPR's business desk. His stories are broadcast on NPR's newsmagazines, All Things Considered, Morning Edition and Weekend Edition, and he regularly guest hosts 1A, a co-production of NPR and WAMU.
Bobby Allyn is a business reporter at NPR based in San Francisco. He covers technology and how Silicon Valley's largest companies are transforming how we live and reshaping society.
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