The trial of Elizabeth Holmes, founder and former chief executive of medical technology company Theranos, has begun in California.
She is pleading not guilty to perpetrating one of the biggest frauds in Silicon Valley history, “an elaborate, years-long fraud” as the US government alleges, and faces up to 20 years in prison.
Theranos itself, which she founded aged 19, has shut down after the unravelling of its claims to have invented a revolutionary finger-prick blood test.
Holmes is accused of knowing this test was unreliable and inaccurate and of hiding this information.
Image: Holmes shared the stage with Bill Clinton and Alibaba co-founder Jack Ma
The Downfall
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By 2014 the company had announced a partnership with US pharmacy chain Walgreens, and Forbes was hailing Elizabeth Holmes as the world’s youngest self-made female billionaire.
Theranos reached its peak in September 2015 when the company was valued at $9bn (£7bn) and Holmes shared a stage with former president Bill Clinton and Chinese entrepreneur Jack Ma in a panel discussion about equality and opportunity.
But a month later, the Wall Street Journal published a front-page story that claimed the company’s blood testing technology was so flawed Theranos was actually using equipment made by other businesses to carry out tests in its laboratories.
The Journal reported that the company’s former chief scientist had taken his own life two years earlier after telling his wife the finger-prick technology did not work.
Image: Holmes has pleaded not guilty to the charges
The Charges
Investigations by medical and financial regulators soon followed and in 2018 criminal charges were filed against Elizabeth Holmes and Romesh Balwani, her former boyfriend and the president and chief operating officer of Theranos, accusing them of fraud.
The pair were charged with engaging “in a multi-million-dollar scheme to defraud investors, and a separate scheme to defraud doctors and patients” and each face two counts of conspiracy to commit wire fraud and nine counts of wire fraud.
Theranos made misrepresentations to doctors and patients about the reliability of its tests, the Department of Justice alleged.
The executives were also accused of making misrepresentations to investors about the financial condition of the company, celebrating expected sales of over $1bn when they were actually bringing in just a few hundred thousand.
Image: Theranos president Ramesh Balwani has also been charged with fraud – which he denies
The Trial
Lawyers for Holmes are expected to argue that she was working with an impaired mental state at the time of the fraud due to alleged sexual abuse and coercive behaviour by Ramesh Balwani.
Balwani’s lawyers have denied these claims.
His trial is set to take place next year after his lawyers sought to have him tried separately to avoid Holmes’ testimony prejudicing the jury. He too has pleaded not guilty.
According to an unsealed court document written by Balwani’s lawyers when seeking to have his case heard separately, she “plans to introduce evidence that Mr Balwani verbally disparaged her and withdrew ‘affection if she displeased him’; controlled what she ate, how she dressed, how much money she could spend, [and] who she could interact with”.
The jury selection process has been a challenge, with dozens already removed after confirming their familiarity with media coverage of the case, and with others now asked whether they have any experience of abusive relationships.
The main defence expected from Holmes’ lawyers is that Balwani’s controlling behaviour “erased her capacity to make decisions”, including in the case of knowingly defrauding investors, doctors and patients.
Image: Holmes will be tried at a court in San Jose, California
What does it mean?
Both defendants previously reached a settlement with the Securities and Exchange Commission, relinquishing their shares in the company and paying a $500,000 (£360,000) penalty.
But their case is also emblematic of what is often seen as a culture of ‘fake-it-until-you-make-it’ among Silicon Valley startups, as Sky News business presenter Ian King writes.
Analysis by Ian King, business presenter
There are many lessons to be drawn from the Theranos affair, but perhaps the most worrying thing that has emerged is the culture of secrecy that existed in Theranos, a culture that was – and is – by no means unique in Silicon Valley.
John Carreyrou, the investigative journalist at the Journal whose stories exposed the scandal, has since written a book on the saga, Bad Blood, which highlights the weirdly cultish nature of the company.
Again, in this regard, Theranos was perhaps not so different from a number of other companies in the Valley.
Quite apart from the crushing losses for investors, this secrecy and cult-like nature had other real-world consequences, with many patients likely to have received erroneous blood test results.
There are many outstanding questions surrounding Theranos, not least the outcome of Ms Holmes and Mr Balwani’s forthcoming fraud trial, as well as whether the remaining patents being acquired by Fortress will turn out to have any lasting value.
The biggest of all, though, is whether there are other tech companies presently enjoying outlandish valuations that eventually turn out to be similarly flawed.
The chances must be that there are.
Jury selection has begun in the trial, which the court expects may continue into December.
Tanking stock markets, collapsing world orders, devastating trade wars; economists with their hair ablaze are scrambling to keep up.
But as we try to make sense of Donald Trumps’s tariff tsunami, economic theory only goes so far. In the end this surely is about something more primal.
Power.
Understanding that may be crucial to how the world responds.
Yes, economics helps explain the impact. The world’s economy has after all shifted on its axis, the way it’s been run for decades turned on its head.
Instead of driving world trade, America is creating a trade war. We will all feel the impact.
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PM will ‘fight’ for deal with US
Donald Trump says he is settling scores, righting wrongs. America has been raped, looted and pillaged by the world trading system.
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But don’t be distracted by the hyperbole – and if you think this is about economics alone, you may be missing the point.
Above all, tariffs give Donald Trump power. They strike fear into allies and enemies, from governments to corporations.
This is a president who runs his presidency like a medieval emperor or mafia don.
It is one reason why since his election we have seen what one statesman called a conga line of sycophants make their way to the White House, from world leaders to titans of industry.
The conga line will grow longer as they now redouble their efforts hoping to special treatment from Trump’s tariffs. Sir Keir Starmer among them.
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President Trump’s using similar tactics at home, deploying presidential power to extract concessions and deter dissent in corporate America, academia and the US media. Those who offer favours are spared punishment.
His critics say he seeks a form power for the executive or presidential branch of government that the founding fathers deliberately sought to prevent.
Whether or not that is true, the same playbook of divide and rule through intimidation can now be applied internationally. Thanks to tariffs
Each country will seek exceptions but on Trump’s terms. Those who retaliate may meet escalation.
This is the unforgiving calculus for governments including our own plotting their next moves.
The temptation will be to give Trump whatever he wants to spare their economies, but there is a jeopardy that compounds the longer this goes on.
Image: Could America’s traditional allies turn to China? Pic: AP
Malcolm Turnbull, the former Australian prime minister who coined the conga line comparison, put it this way: “Pretty much all the international leaders I have seen that have sucked up to Trump have been run over. The reality is if you suck up to bullies, whether it’s global affairs or in the playground, you just get more bullying.”
Trading partners may be able to mitigate the impact of these tariffs through negotiation, but that may only encourage this unorthodox president to demand ever more?
Ultimately the world will need a more reliable superpower than that.
In the hands of such a president, America cannot be counted on.
When it comes to security, stability and prosperity, allies will need to fend for themselves.
And they will need new friends. If Washington can’t be relied on, Beijing beckons.
America First will, more and more, mean America on its own.
Actors, directors and celebrity friends have paid tribute to Val Kilmer, after he died aged 65.
The California-born star of Top Gun, Batman and Heat died of pneumonia on Tuesday night in Los Angeles, his daughter Mercedes told the Associated Press.
She said Kilmer was diagnosed with throat cancer in 2014 but later recovered.
Tributes flooded in after reports broke of the actor’s death, with No Country For Old Men star Josh Brolin among the first to share their memories.
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2:49
Watch: Val Kilmer in his most iconic roles
He wrote on Instagram: “See ya, pal. I’m going to miss you. You were a smart, challenging, brave, uber-creative firecracker. There’s not a lot left of those.
“I hope to see you up there in the heavens when I eventually get there. Until then, amazing memories, lovely thoughts.”
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Kyle Maclachlan, who co-starred with Kilmer in the 1991 biopic The Doors, wrote on social media: “You’ll always be my Jim. See you on the other side my friend.”
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Michael Mann, who directed Kilmer in 1995’s Heat, also paid tribute in a statement, saying: “I always marvelled at the range, the brilliant variability within the powerful current of Val’s possessing and expressing character.
“After so many years of Val battling disease and maintaining his spirit, this is tremendously sad news.”
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Heat co-star Danny Trejo also called Kilmer “a great actor, a wonderful person, and a dear friend of mine” on Instagram.
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Cher, who once dated the actor, said on X that “U Were Funny, crazy, pain in the ass, GREAT FRIEND… BRILLIANT as Mark Twain, BRAVE here during ur sickness”.
Lifelong friend and director of Twixt, Francis Ford Coppola said: “Val Kilmer was the most talented actor when in his High School, and that talent only grew greater throughout his life.
“He was a wonderful person to work with and a joy to know – I will always remember him.”
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The Top Gun account on X also said it was remembering Kilmer, who starred as Iceman in both the 1986 original and 2022 sequel, and “whose indelible cinematic mark spanned genres and generations”.
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No one expected penguins to bear the brunt of Liberation Day.
But among the barrage of tariffs set out by Donald Trump, the US also took aim at uninhabited islands, talked up American beef and turned its nose up at plastic eggs.
Here is what you might have missed in the US leader’s expansive announcement.
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5:07
What the numbers behind Trump’s tariffs really mean
Tiny territories hit with big tariffs
At first glance, newly imposed tariffs on countries such as China, the European Union, India and the UK stand out – ranging from 34% to 10% respectively.
But the president also imposed tariffs on dozens of tiny territories – some of which don’t even have human inhabitants.
One of those was the Heard and McDonald Islands, an external territory of Australia in the Antarctic that is inhabited only by penguins and seals.
Image: All of Australia’s external territories that have been hit with US tariffs
Despite having no human residents – or imports and exports – the island now faces a 10% tariff for any goods bound for the US.
According to export data from the World Bank, the US imported $1.4m (£1m) of mainly “machinery and electrical” products from Heard Island and McDonald Islands in 2022.
Australian territory Norfolk Island, a volcanic island 600 miles east of Queensland, was also hit with a hefty 29% tariff on exports to the US. That’s much higher than mainland Australia, which had a 10% tariff imposed.
The news was met with confusion by some of Norfolk Island’s 2,188 residents.
“Norfolk Island is a little dot in the world,” Richard Cottle, owner of a concrete-mixing business on the island, said on Thursday.
“We don’t export anything. It was just a mistake”.
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3:27
How is the world reacting to Trump’s tariffs?
Although the island does ship a modest amount of Kentia palm seeds abroad, this is typically worth less than $1m (£760,000) a year, with the products mostly going to Europe.
According to US government data, America has recorded trade deficits with Norfolk Island for the past three years.
Other tiny nations and territories were also hit with 10% tariffs, including Tokelau, a dependent territory of New Zealand, with a population of around 1,600 people, and the Cocos Islands, another territory of Australia, with a population of around 600 people.
Australian Prime Minister Anthony Albanese told reporters he had no explanation for the tariffs, calling them “unexpected” and “a bit strange”.
Image: We have a feeling the seals won’t welcome Trump for his next holiday to the Heard Island… Pic: AP
‘Our beef is beautiful, theirs is weak’
After announcing a 20% tariff against the European Union, Mr Trump’s secretary of commerce Howard Lutnick spoke to Fox News to try to explain what was behind the decision.
In a brief but bizarre rant, Mr Lutnick spoke about the bloc’s ban on imported chicken from the US.
“I mean European Union won’t take chicken from America,” he said.
“They will take lobsters from America… they hate our beef because our beef is beautiful and theirs is weak.”
The EU has a ban on chicken washed in chlorine – a practice that is approved by the United States Department of Agriculture.
Although US beef is not completely prohibited in Europe, any beef that has been treated with artificial growth hormones – which is legal in the US and common among producers – is banned by the EU.
Why was Russia exempt?
Russia was not on Mr Trump’s tariff list, despite his threat to introduce some on Russian oil imports last week.
The US president made the threat after telling NBC’s Kirsten Welker he was “very angry” and “pissed off” after Vladimir Putin criticised the credibility of Ukraine’s president Volodymyr Zelenskyy, as fragile peace negotiations are ongoing.
Mr Trump said that if Russia was unable to make a deal on “stopping bloodshed in Ukraine” – and Mr Trump felt that Moscow was to blame – then he would put secondary tariffs on “all oil coming out of Russia”.
“That would be that if you buy oil from Russia, you can’t do business in the United States. There will be a 25% tariff on all oil, a 25 to 50-point tariff on all oil,” he said.
Axios reported that White House press secretary Karoline Leavitt told the publication on Wednesday that Russia was left off the tariffs list because US sanctions already “preclude any meaningful trade”.
Russia ran a $2.5bn goods trade surplus with the US in 2024, according to the US Trade Representative’s office, falling from $35bn in 2021 as a result of sanctions put in place due to the war in Ukraine.
World’s poorest nations face highest tariffs
Many of Mr Trump’s tariffs have targeted the world’s poorest countries.
Lesotho in southern Africa, listed as the 22 poorest country in the world, has been slapped with the highest duty of 50%. It primarily exports diamonds and garments, with the US as one of the top five exporting destinations, Sky News’ US partner network NBC News reported.
The second-highest tariff went to Cambodia at 49%, even though the US is Cambodia’s largest single-country export destination.
Madagascar in east Africa, the world’s ninth poorest country, will face 47% reciprocal tariffs. It primarily exports vanilla, cloves, and garments, with the US among the top five countries it exports to, according to NBC.
‘Huge complexities’ for Northern Ireland and the Republic
Image: Deputy premier Simon Harris said the difference in tariffs between the Republic of Ireland and Northern Ireland will cause complexities. Pic: Cillian Sherlock/PA Wire
Under the 10% tariff imposed on the UK, Northern Irish goods will also be covered at the same rate.
Whereas the Republic of Ireland will subject to a 20% tariffs – which Mr Trump imposed on the entirety of the EU.
Reacting to the announcement, Ireland deputy premier Simon Harris said the tariff difference would create “huge complexities” for products that need to be carried across the cross-border dimension during production.
He said the issues were similar to those at play during the Brexit debate around maintaining a frictionless land border on the island of Ireland.
Mr Harris said it was on the US to “outline their understanding” on how the 10% differential between Northern Ireland and Ireland will play out.
Trump defines groceries
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Trump says ‘groceries’ is a ‘beautiful term’
As has become common when delivering major addresses, the US president repeatedly deviated from his script.
At one point, he took time to define the word groceries: “It’s a bag with a lot of different things in it.”
He went on to describe the word as “old-fashioned” but “beautiful”.
‘Could you use plastic eggs?’
In another part of his wide-ranging speech, Mr Trump got onto the topic of eggs – the price of which reached an all-time high earlier this year in the US due to the outbreak of bird flu.
On Wednesday, Mr Trump confirmed that the annual White House tradition of rolling around 30,000 Easter eggs across the South Lawn is expected to proceed, and will use real eggs, despite pleas for plastic ones to be used instead.
“They were saying that for Easter ‘Please don’t use eggs. Could you use plastic eggs?’ I say, we don’t want to do that,” Mr Trump said.
He did not clarify who was telling him not to use real eggs.