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Elizabeth Holmes, founder of Theranos Inc., exits federal court in San Jose, California, on Tuesday, Aug. 31, 2021.
David Paul Morris | Bloomberg | Getty Images

SAN JOSE, CALIF. — A hedge fund manager who put $96 million into Theranos said he thoroughly investigated the company but was still misled by CEO Elizabeth Holmes about its blood-testing technology.

Brian Grossman, chief investment officer at PFM Health Sciences, told jurors in Holmes’ criminal trial on Tuesday that in 2014, as part of his due diligence, he got his own blood drawn from a Theranos machine at a Walgreens pharmacy.

“I had my blood drawn with a venous draw, not a finger stick,” said Grossman, adding that the experience undermined what he’d been told about Theranos.

Grossman said he met with Holmes and her top executive, Ramesh “Sunny” Balwani, at their office in Palo Alto, California, in December 2013. He said Holmes did most of the talking, and that he and his colleagues were told Theranos could run 1,000 blood tests on its proprietary technology.

“Ms. Holmes was actually very clear that they could match any test on a Labcorp and Quest menu of tests,” Grossman said. He told jurors that “was a really big statement about how much they had accomplished, where the technology was at that time.”

Earlier witnesses, including lab associate Erika Cheung, have testified that Theranos devices couldn’t run more than 12 different tests, contradicting the company’s public pronouncements.

Grossman said that in the meeting he was told Theranos was working with the military and that its technology was being used on medivacs in the battlefield.

“What better application for a technology like this than in a military setting under harsh conditions like one would expect in a place like Afghanistan or Iraq?” Grossman said. Theranos indicated that it had “something over $200 million in revenue from the Department of Defense,” he said.

Daniel Edlin, a former Theranos employee, told jurors last month that, to his knowledge, the blood-testing devices were never used in the Middle East.

‘No ambiguity and no confusion’

Grossman said that following his initial meeting with Holmes and Balwani, he sent them an e-mail in January 2014, with the subject: “Due Diligence Questions.”

His questions from PFM fell into seven categories. He wanted more details on issues like the accuracy and speed of the tests compared to those from traditional vendors, the limitations of the technology and whether the Walgreens relationship was exclusive.

“We as a group came up with questions that we wanted to better understand the business,” Grossman said. “We wanted to ask the same questions in as many ways as we could so there was no ambiguity and no confusion as to what the technology was doing.“

PFM then met with Holmes and Balwani a second time. Grossman testified that Holmes left about halfway through the meeting. Theranos executives told him at the time that it could get test results back in under four hours in retail stores and within one hour in hospitals.

Grossman told the jury that Holmes never told him the company was using third-party machines to run the blood tests. About his own experience at Walgreens, Grossman said he was surprised to find out that the blood was drawn from his arm and said his test results took longer than four hours.

“I asked [Balwani] why I didn’t receive a finger stick and why it was a venous draw,” Grossman said. “I also asked him why it took longer than four hours to get my test results back.”

Balwani assured him it was because his doctor ordered an unusual test, Grossman said.

Still, PFM invested $96.1 million in Theranos in February 2014. That investment included $2.2 million from a friends and family fund, which Grossman said had money in it from low-income people.

PFM eventually settled its lawsuit against Theranos after accusing the company of securities fraud.

Holmes has pleaded not guilty to 12 counts of wire fraud and conspiracy to commit wire fraud. As a witness to the prosecution, Grossman’s testimony underpins one of the wire fraud counts.

For 11 weeks, Holmes has sat at the defense table as government witnesses have testified. A key question remaining is whether the defense will present a case after the prosecution rests.

“We don’t even know if there is a defense case and if there is what it might be,” Lance Wade, an attorney for Holmes, said before the jury entered the courtroom. “We’re still in the government’s case.”

Last week Holmes’ defense team provided the government a list of potential witnesses. However, Wade said, “we’re not saying we’re presenting a defense case by giving them a sense of the witnesses.”

WATCH: The deposition tapes from the Elizabeth Holmes trial

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Cryptocurrencies rise to start the week, bitcoin jumps above $102,000

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January 6, 2025

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Cryptocurrencies rise to start the week, bitcoin jumps above 2,000

The photo illustration shows the Bitcoin cryptocurrency on November 12, 2024 in Shanghai, China.

Vcg | Visual China Group | Getty Images

The price of bitcoin leapt back above $100,000 to start the first full trading week of the new year.

The flagship cryptocurrency was last higher by about 4% at $102,234, according to Coin Metrics. The broader crypto market, as measured by the CoinDesk 20 index, gained more than 3%. Bitcoin and ether are coming off their best weeks since Dec. 6, while Solana had its best week since Nov. 22.

“Overall, we are in a bullish environment and traders appear to be risk-on as we head into the new year,” Mario Jurina, CEO at crypto swaps platform Jumper.Exchange. “With Trump’s election set to be certified today, and January often being a bullish month — six of the past 10 years saw positive price action — it’s no wonder markets are moving upward.”

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Bitcoin rises above $100,000 to start the week

The moves in crypto coincided with a rebound in tech stocks as Nvidia and shares of other chip names jumped. The tech-heavy Nasdaq was last higher by about 1.7%.

Crypto stocks Coinbase and MicroStrategy advanced nearly 6% and 5%, respectively. MicroStrategy Monday morning reported it has purchased another 1,070 bitcoins for about $101 million, bringing its total bitcoin holdings to 447,470.

Activity is coming back into the crypto market after a post-election rally that was driven by promises of a more supportive regulatory environment. The optimism sent prices rocketing for weeks before cooling at the end of the year. The price of bitcoin is expected to roughly double under the new administration this year, with some price predictions, like Fundstrat’s Tom Lee’s, being as high as $250,000.

Don’t miss these cryptocurrency insights from CNBC Pro:

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Amazon’s Ring announces smart smoke alarm as CES tech palooza kicks off

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January 6, 2025

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Amazon's Ring announces smart smoke alarm as CES tech palooza kicks off

Ring security cameras are displayed on a shelf at a Target store on June 01, 2023 in Novato, California. 

Justin Sullivan | Getty Images

Amazon‘s Ring is partnering with fire safety product maker Kidde to launch a connected smoke alarm, the company announced Monday at the Consumer Electronics Show in Las Vegas.

The companies plan to launch Kidde smoke and carbon monoxide alarms that integrate Ring’s home security technology and can deliver alerts to the Ring mobile app. The Kidde Smart Smoke Alarm with Ring will cost $54.97, while the Kidde Smart Smoke and CO Alarm with Ring will cost $74.97. Both products will ship in April.

As part of the launch, Ring will also roll out a $5-per-month subscription service that gives users access to round-the-clock professional monitoring and emergency dispatchers.

Amazon acquired Ring in 2015 for a reported $1 billion. The home security company is primarily known for its video doorbell devices, which allow users to record activity in front of their homes, though it has expanded to include a portfolio of products ranging from camera-equipped floodlights to flying security camera drones.

Amazon doesn’t disclose unit sales for its Ring division, but Ring and rival home security company SimpliSafe comprise one-fifth of the U.S. market for professional monitoring systems, according to data from market research firm Parks Associates. Ring CEO Liz Hamren, who took the helm from founder Jamie Siminoff in March 2023, told Bloomberg last May that the company “recently” became profitable.

Users aren’t required to subscribe to Ring Home, the company’s program that enables video recording storage and other security features, in order to access the new smoke alarm service.

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Global chip stocks climb as Foxconn’s bumper results show a continuation of the AI boom

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January 6, 2025

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Global chip stocks climb as Foxconn's bumper results show a continuation of the AI boom

Jakub Porzyck | Nurphoto | Getty Images

Global semiconductor stocks climbed on Monday after contract electronics giant Foxconn announced record fourth-quarter revenues, suggesting the artificial intelligence boom has far more room to run.

Hon Hai Precision Industry, which does business as Foxconn internationally, said in a Sunday statement that the company’s fourth-quarter revenue totaled 2.1 trillion New Taiwan dollars ($63.9 billion), growing 15% year-over-year.

Foxconn — which is a supplier to Apple — also set a record, posting the highest fourth-quarter revenue ever in company history, according to the statement.

The firm’s bumper revenue performance was driven by growth in its cloud and networking products — which includes AI servers like those designed by the likes of chipmaker Nvidia — and components and other products segments.

Computing products and smart consumer electronics — which numbers iPhone and other smartphones — saw “slight declines,” Foxconn said.

Shares of several semiconductor firms across Asia, Europe and the U.S. rose, as a result.

In Asia, TSMC hit a record high Monday and closed 1.9% higher in Taiwan.

The largest semiconductor manufacturer globally, TSMC produces chips for the likes of AMD and Nvidia.

Other Asian chip firms also logged share price gains — South Korea’s SK Hynix and Samsung rose nearly 10% and 4%, respectively.

In Europe, globally critical semiconductor equipment firm ASML saw its shares jump almost 6%, while fellow Dutch chip company ASMI’s stock rose almost 5%. Germany’s Infineon surged more than 6%.

The momentum in semi stocks could last as they have great earnings momentum, says Jim Cramer

Paris-listed shares of European contract chipmaker STMicroelectronics rose nearly 6%.

Stateside, Nvidia got a boost from the Foxconn numbers, climbing 2% in U.S. premarket trading.

Also boosting chip stocks on Monday was Microsoft’s announcement at the end of last week about plans to invest $80 billion in 2025 on data centers that can handle AI workloads.

Microsoft is one of several tech giants splurging on GPUs (graphics processing units) from Nvidia to train and run the most advanced AI models.

AMD, Nvidia’s closest rival, rose 3% in pre-market trading Monday, while fellow U.S. chip firms Qualcomm and Broadcom both climbed almost 2%.

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