Who is Elizabeth Holmes? Embattled Theranos founder may claim she’s insane in criminal fraud trial defense
"Mental disease defense", yes you read that right, this is what Elizabeth Holmes, the founder, and CEO of Theranos is planning to resort to in her criminal fraud trial, according to a new court document. Holmes may claim that she was suffering from a mental disease when she allegedly defrauded investors out of hundreds of millions of dollars with her fake blood-testing technology.
According to Daily Mail, the plan to use mental disease defense was revealed on Wednesday, September 9, when the US District Court in San Diego stated that experts selected by the prosecution could examine the Theranos founder. Judge Edward Davila approved the examinations after Holmes’ lawyers said that they planned on introducing expert evidence from a clinical psychologist relating to a “mental disease or defect or any other mental condition of the defendant bearing on the issue of guilt”.
Evidence like this could be used to challenge the requirement that prosecutors prove the disgraced Theranos founder’s intent to do something illegal. Davila's ruling rejected the argument by Holmes' lawyers that she shouldn't have to submit to a psychological examination by experts. The judge also said that the examination is important for the prosecution to make an "effective rebuttal" as the defense is providing testimony from its own expert - Mindy Mechanic, who is a California State University professor. She specializes in the psychosocial consequences of violence, trauma, and victimization, including violence against women.
Under Davila's ruling, a psychologist and psychiatrist chosen by the government will examine Holmes for 14 hours over two days, reported CNN. These examinations would be recorded on video. Holmes' lawyers had claimed that video recording would "negatively affect the tenor or the interview", however, Davila overruled the defense's objections. Holmes' mental state has been previously discussed in court documents and a closed July 8 hearing.
Barbara McQuade, a former federal prosecutor, told Bloomberg that the mental disease defense would be a challenge as it requires a very high standard of proof. “Contrary to what you may see in the movies, an insanity defense in federal cases is rare and hard to fake,” McQuade said. She also stated that Holmes will have to show that a severe mental disease made her “unable to appreciate the nature and quality or the wrongfulness of [her] acts” at the time of the alleged fraud.
Holmes and former Theranos President Ramesh "Sunny" Balwani have been accused of misleading and defrauding investors, policymakers, and the public about the accuracy of Theranos' blood-testing technologies from 2003 to 2015. Theranos, which is now-defunct, claimed that it could transform medical lab testing with technology that could enable a wide range of tests with a few drops of blood. Holmes and Balwani, who were in a relationship during their time at the company, pleaded not guilty to 11 counts of wire fraud and conspiracy to commit wire fraud.
Before the scandal, Theranos had been valued at $9 billion. Holmes, a Stanford University dropout who founded the company in 2003 at age 19, became the world's youngest female self-made billionaire. The Theranos founder and Balwani were originally indicted in June 2018. Balwani's case is being handled separately, while Holmes’ trial is scheduled for March 2021. The trial, which was initially set to begin this summer, was delayed due to the coronavirus pandemic. Holmes and Balwani could face up to 20 years in prison.
According to Deadline, actress Kate McKinnon was roped in to play Holmes, in a new Hulu "limited drama series", since the streaming service is closing a deal for an adaptation of Rebecca Jarvis and ABC News’s podcast 'The Dropout'. The aforementioned podcast focused on Holmes’ rise to celebrity as the "next Steve Jobs" after dropping out of Stanford to focus on her blood-testing company Theranos, and how she was later embroiled in a controversy after being revealed as a fraud. Even in the past, Holmes was the subject of another HBO documentary called 'The Inventor: Out for Blood in Silicon Valley' that explored the story of Theranos and how its founder was able to defraud investors and potential customers.