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Elizabeth Holmes trial begins — here are the biggest takeaways from openings statements

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Alexis Keenan joins Brian Sozzi and Julie Hyman to break down the latest developments in the Theranos trial as the prosecution delivers opening statements claiming founder Elizabeth Holmes lied to investors to secure funding for the company.

Video transcript

BRIAN SOZZI: Opening arguments kicked off in the case against Theranos founder Elizabeth Holmes. Yahoo Finance's Alexis Keenan is covering the proceedings and joins us now. Alexis.

ALEXIS KEENAN: Hi, Brian. So opening statements concluded yesterday afternoon, and that's all about laying out for the jurors competing narratives. First up was the government explaining why it charged Holmes and her co-defendant, Sunny Balwani, with wire fraud and conspiracy.

Now, prosecutors told jurors that Holmes and her co-defendant Balwani used Theranos, the company's blood-testing device, and the company itself to reach into the pockets of investors and into the pockets of patients. And they said when the company was out of time and out of money, they were pressed for cash and lied about the company's technology, as well as its revenue projections, as well as endorsements, as well as to media, to partners like Walgreens and Safeway.

They said even there were lies that were provided to falsely endorse-- to say that Pfizer, pharma giant Pfizer, falsely endorsed the company. And also they said that Holmes lied about the technology being in remote military zones. But really, a different story came from Holmes' lawyers, as expected. Holmes' lawyers said that she really dedicated her entire life to working for this company, saying she worked to the bone for 15 years, since age 19, to make lab testing more affordable.

Her lawyer also said that she made mistakes along the way, but that mistakes do not equal crimes. He emphasized that Holmes was also not alone in her belief that the industry-- the diagnostic testing industry needs to be disrupted and that it's dominated still by companies like Quest and LabCorp. He also hinted at what could be part of the strategy, saying that there was another side to Holmes' relationship with Balwani, and that nobody else saw that side of the relationship. In filings and court documents, Holmes has raised the possibility of arguing in a defense that she was abused by Balwani. However, Balwani has vigorously denied those claims.

Now, overall, Holmes raised $900 million for the company from wealthy investors as well as from investment funds, though about $155 million is what is alleged in the indictment in bank fraud wires that are at issue here. Now, her lawyers also stressed that this money came from these wealthy investors who understood and attested to the high risk of their investments. And ultimately, they said, Holmes, at the end of the day, when she locked the key and walked away from Theranos and the building and the company as a whole, that she walked away with nothing, having never cashed in any stock in her company, despite being a billionaire on paper. Guys.

JULIE HYMAN: Alexis, so all of this is sort of about what was going on in the courtroom. Just briefly, if you could, I'm curious about what wasn't going on-- what was going on outside of the courtroom, right? This has been a hotly anticipated trial. She is a highly visible public figure. You've done an enormous amount of reporting on her and that fundraising effort. What was the scene like?

ALEXIS KEENAN: So before the court even opened in the morning-- I was there at 4:30 in the morning and already there were reporters. There were people just of general interest, spectators who wanted to see the trial. The line to get in wrapped around the corner of the courthouse. I never got to really see the end of it.

But absolutely there's a lot of interest here, both by media-- again, a second time around here, I suppose. Holmes was also there with her family showing a sign of support there. Her husband was there, as was her mother and her father. But a lot of interest. And court is dark today, so we'll see if that level of interest keeps up for tomorrow's testimony.

BRIAN SOZZI: And of course, a quick plug. Be sure to check out Alexis' original documentary, "Valley of Hype-- The Culture that Built Elizabeth Holmes." It's on our website. I'm looking at it right now. It's all over various streaming platforms. Really enjoyed this one, Alexis. We'll check back with you soon.

ALEXIS KEENAN: Thanks, guys.

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