That appears to be a big takeaway from yesterday’s hearing in U.S. District Court in Northern California, in which the defense team for Holmes and former Theranos president Sunny Balwani made a host of arguments in an attempt to dismiss the case.
Holmes and Theranos were once Silicon Valley darlings, with Holmes claiming that her company was set to revolutionize blood testing with technology that could analyze tiny amounts of blood. Forbes in 2015 even recognized Holmes as America’s richest self-made woman based on Theranos’ multibillion-dollar valuation at the time.
Investigative reporting, though, soon dismantled the claims Holmes was making about Theranos’ technology, raising questions about whether she and others had misled investors. The downward spiral culminated in the 2018 shutdown of the company, with the SEC criminally charging Holmes and Balwani over what it described as a “massive fraud.”
Amy Saharia, a lawyer for Holmes, argued yesterday that accusations against her client are too vague, according to media reports.
“All tests have error rates. The government should not be permitted to try a case with anecdotes when incorrect blood tests are a fact of life,” Saharia said, as reported by The Mercury News of San Jose.
Prosecutors, though, claim that Holmes and Balwani sold blood diagnostics technology that they knew was faulty. Their case includes stories of people who received faulty HIV and pregnancy tests via Theranos.
Saharia claimed that there was no harm because people receiving the tests didn’t pay for them — their insurers did — and wire fraud involves loss of money and property.
It was the scheme that was the fraud, said John Bostic, an assistant U.S. attorney.
“Evidence will show patients went to Theranos to get results that were accurate. And when doctors sent patients to Theranos this was not for fun, this was not something you do on a Saturday afternoon. … They were aware they were misleading people by offering those tests.” said Bostic, as reported by CNBC.
