Elizabeth Holmes trial: Defense lays out case for ‘reasonable doubt,’ legal analyst says

Legal analyst and former U.S. Assistant DA Michele Hagan speaks with Yahoo Finance’s Alexis Keenan on the Elizabeth Holmes trial as the defense is within minutes of ending the case against the former Theranos CEO.

Video transcript

KARINA MITCHELL: Welcome back to Yahoo Finance. Well, the defense in the trial of Elizabeth Holmes is moments away from resting the case, that after the prosecution rested their case on Thursday, bringing to an end the dramatic proceedings that have stretched on for more than 15 weeks. Here with more, we take you outside the courthouse to Yahoo Finance's Alexis Keenan.

ALEXIS KEENAN: Good afternoon. We're taking a break here from closing arguments. And right now, the defense is just about to finish its closing. They said they have about 20 more minutes here. But I have with me a guest, a special guest today who has been attending the whole trial. Her name is Michelle Hagan, and she has been sitting in. She's a former prosecutor and a legal analyst. And so we're going to talk to her a bit about her impressions from an expert's point of view.

So Michelle, thanks so much. So, today, we have heard a lot about who might be responsible for the statements that were made, maybe not Elizabeth Holmes the defense attorneys say. We've heard about investors, we've heard about lab directors, and we've heard about employees who have raised concern at the company. But what stood out to you today so far in the defense closing?

MICHELLE HAGAN: Well, I think the defense is doing a good job of bringing up all possible reasons for the jury to conclude reasonable doubt. You know, it's really important for the jury to decide what did Elizabeth Holmes know, was she on notice about the technology being unreliable, and if she was, what did she do about it? And also whether she made certain statements, or whether the investors had misunderstandings about what she meant. So that's going to be a call the jury has to make.

ALEXIS KEENAN: Now the defense was honing in on the fact that these were really sophisticated investors, big money investors who were long-term investors, had every intention of just hanging in for the long-term. So why does that matter, if at all?

MICHELLE HAGAN: It matters, because it goes to-- or it rebuts what Elizabeth told them. If they did their own due diligence, their own investigation, if they relied on something other than her representations to them, then the jury could find her not guilty.

ALEXIS KEENAN: OK, and now we've heard so much about in order to prove a case like this for wire fraud and conspiracy, that there has to be a false statement or a misleading statement or omission, and there also has to be Holmes' knowledge that she did that and with the intent to take something of value from somebody else. So has the government accomplished that in your opinion at this point?

MICHELLE HAGAN: Well, I think there's plenty of evidence to show that they have, but again, we have rebuttal coming up, which is the government's last opportunity to convince this jury of Ms. Holmes's guilt.

ALEXIS KEENAN: So now we have-- we're hearing just about 20 more minutes of closing from the defense. This is the very last opportunity for the jurors to hear Holmes's side of the story at all. So tell us about the stakes here.

MICHELLE HAGAN: The stakes are really high for the defense. They have 11 counts of wire fraud. And again, we've heard from 29 witnesses on behalf of the government who said that she made these misrepresentations, what the government says is wire fraud. So it's high stakes for the defense. And the defense is doing a really good job of if the jury wants to find reasonable doubt, then there are opportunities to find that.

ALEXIS KEENAN: OK, and so the next stage after this is going to be what I've heard many attorneys call the dreaded rebuttal from the prosecution. They're the ones who are going to get the last word. What are they going to do then? What is the strategy there when they've been already talking now in their closing for four hours?

MICHELLE HAGAN: Well, actually, we also consider this the Hail Mary. So the rebuttal is the last opportunity for the government to show and also to rebut everything that the defense has brought up. And they have, I'm sure, plenty that they're going to argue.

ALEXIS KEENAN: OK, and also, this is going into now a holiday week, the new year. The jurors are pressed against some time here, perhaps. How could that weigh in?

MICHELLE HAGAN: Well, typically, my experience, having tried a bunch of cases, is when the jury is up against either Thanksgiving or Christmas, they tend to want to make a decision before the holidays. They don't want to be taking this with them and coming back in January. So, you know, it could indicate that they're going to come back earlier, but we'll see.

ALEXIS KEENAN: Now I want to go back to this word "intent" one more time. If there is intent at all, where exactly do you find it, in your opinion?

MICHELLE HAGAN: Well, you have to look at what statements were made on her website for the company. Also I think what's really going to be difficult for the defense to overcome is that Forbes Fortune article and the Rago article, where she, Elizabeth Holmes, gave the investors copies, sent that out. People read that, and in those articles were misstatements. And she never corrected those misstatements.

ALEXIS KEENAN: OK, so does she have an obligation to fix those errors?

MICHELLE HAGAN: Yeah, she has an obligation because those are the representations she's thinking about the technology. And those were not-- those statements were not corrected. So was she sending that out to deceive people, or was it just simply an oversight?

ALEXIS KEENAN: Michelle Hagan, former prosecutor, thank you so much. I'm going to send it back to the studio now.

KARINA MITCHELL: All right, thank you so much, Alexis Keenan and Michelle Hagan, legal analyst and former US assistant district attorney, as defense gets set to wrap up their defense of Elizabeth Holmes in that trial.