The case of Theranos founder Elizabeth Holmes, Convicted on Monday on federal felony charges, Inspired books, podcasts, documentaries, and upcoming feature films.
Now, get ready for the various sequels: the criminal trial of former Theranos chief operating officer Ramesh “Sunny” Balwani, Holmes’ mentor and ex-boyfriend, is expected to begin in March.
San Jose, California jury Holmes, 37, was convicted of conspiracy to defraud Theranos investors and three counts of wire fraud against three Theranos investors. However, the team acquitted her on charges of conspiracy and fraud involving Theranos patient. The jury was unable to reach an unanimous verdict on the other three charges of wire fraud against other Theranos investors, and the U.S. District Judge Edward Davila declared these allegations invalid.
Balwani, 56 years old, worked with Holmes at Theranos for nearly 7 years after becoming friends with her when she graduated from high school at the age of 18. toll It is almost the same as the Sherlock Holmes case. He has pleaded not guilty.
Barbara McQuade, a law professor at the University of Michigan, former U.S. Attorney and NBC News legal analyst, said that the mixed verdict of the Holmes trial means that both the prosecution and defense in the Barwani case may need to The coming trial readjusted its strategy.
McQuade told CNBC “American greed“When it comes to Theranos patients, prosecutors need to carefully review their case.
“Knowing that this jury has acquitted all patients in terms of numbers, I think strategically, they should find a more direct way to explain why this is part of the fraud. They must know that the patient will be defrauded in the end. And that despite They don’t know the names of these patients, but they know they exist in the concept,” McQuaid said.
She said that prosecutors can even amend their indictment against Balwani, although this will almost certainly postpone the trial. The government has not yet indicated whether it intends to change its strategy. Another hearing on the case is scheduled for Wednesday.
Balwani’s defense team may face more pressing issues than the government. After all, although the jury acquitted Holmes on some counts, she was found guilty on four counts. Wire fraud is the most serious crime, with a maximum sentence of 20 years in prison.
“The jury did buy the whole theory,” McQuaid said. “So, another jury will probably do the same.”
In fact, she said, it is not too late for Balwani to consider entering into a plea bargain in exchange for a lighter sentence, although it will not be as light as he pleaded guilty and agreed to cooperate before Holmes’ trial.
“Maybe we can plead guilty and get relief for assuming responsibility?” she said. “Of course this is something you have to see.”
Balwani’s lawyer Jeffrey Coopersmith (Jeffrey Coopersmith) declined to comment on this story.
Balwani’s name appeared frequently during Holmes’ trial, especially during her 7 days in court.exist Emotional testimonyShe claimed that Balwani was nearly 20 years older than her, and that everything from diet to clothes and even her voice controlled all aspects of her life.
“He told me I didn’t know I was in business, my beliefs were wrong, and he was surprised at my mediocrity,” Holmes testify“And I need to kill the person I want to be what he calls the “New Elizabeth”, he can become a successful entrepreneur.”
Holmes also claimed that Balwani forced himself sexually.
In a court document before his testimony, Cooper Smith wrote that Balwani considered the allegations “deeply offensive” and “destructive to the individual.”
McQuade said that just as Holmes tried to throw Balwani under the bus in her trial, Balwani would return her favor.
“If you can point to the empty chair and say,’Oh, that’s all other bad guys,’ then the other bad guys won’t be there to defend themselves,” McQuaid said. “She did this to Balwani in the trial, and I hope that Balwani did this to Holmes in the trial.”
So far, Balwani’s defense team has not indicated that they might bring up similar intimate details of the couple’s relationship, but they may have a lot of other materials to deal with.
The text messages between the couple were introduced as evidence in the Holmes trial and may reappear in Balwani’s, showing that Balwani repeatedly reminded Holmes about the company issues she allegedly concealed from investors, like a 2014 message that he Tell her that Theranos laboratory is “the damn disaster zone.”
Balwani’s defensive team can try to use such evidence to prove that he was well-intentioned, and it was Holmes and Theranos who lost the ball.
“One thing he can say is,’I don’t have a scientific background. I only rely on scientists to tell me whether the product is effective. My job is marketing, sales and accounting.'” McQuaid said.
Holmes himself testified that she was the highest authority of Thernaos and admitted under cross-examination that she was capable of dismissing Balwani at any time, but did not.
The two were supposed to be tried together for their roles in Theranos. The blood testing startup failed in 2018 due to an explosive revelation. Its so-called revolutionary technology did not work as advertised. But after Holmes’ lawyers said they planned to quell allegations of abuse, Judge Davila, who presided over the Balwani trial, agreed to separate their case.
Davila wrote in an order in March 2020: “Such testimony is unfair to the co-defendant, Mr. Barwani, and he will therefore be refused a fair trial unless his trial is consistent with that of Ms. Holmes. Separate,” Davila wrote in the unsealing order on the eve of Holmes’ trial. In August.
Although their cases may differ on who is responsible for Theranos’s problems, they may also have a lot in common. Some pre-trial documents indicate that, like Holmes, Balwani might argue that he had no intention of committing fraud, which is a necessary factor for the government to prove a crime.
In the pre-trial court documents filed on December 6, Balwani’s lawyers stated that they should be allowed to argue that his behavior in dealing with investors was correct.
“Mr. Balwani should be allowed to argue that he believes that the money he collects from the alleged victim is a real investment that he intends to make a profit,” the document said.
Under the leadership of Holmes and Balwani, Theranos raised approximately US$945 million from investors, many of which were prominent figures, including Rupert Murdoch, the family of former Education Secretary Betsy DeVos, and the Walton family Walmart Fame.
Balwani’s defense team also tried to limit evidence involving patients, including test results using non-Theranos diagnostic equipment.
They wrote in a document submitted on December 6: “Unless the accuracy and reliability of Theranos technology is involved, rather than unmodified commercial technology, the evidence regarding the accuracy and reliability of patient testing is not important.”
The prosecutor argued that the use of third-party equipment that Theranos had hidden from the public was part of the alleged fraud.
As they did in the Holmes trial, former Theranos insiders may testify that Balwani is part of a mysterious corporate culture that actively suppresses dissent to conceal problems from investors and patients.
The former Theranos laboratory assistant turned informer Erika Cheung, the prosecution witness in the Holmes case, and was also listed as a potential witness against Balwani. She testified that when she started encountering inaccurate test results, she took her The worry was told to Balwani.
“The feedback and reception I got from him was,’What makes you think you are qualified to make these calls, you are a recent graduate of the University of California, Berkeley, how much do you know about laboratory diagnosis?'” Zhang testify.
In an interview with “American Greed”, Zhang said that the first sign of her trouble in Theranos was that she started to email colleagues about testing issues. To her surprise, she received a reply from Balwani .
“Sunny will reply to them suddenly. He was not CC. He was not BCC,” she said. “What we have said in certain situations will be reiterated to us, just like what we said in private.”
Cheung eventually took her concerns outside the company and shared them with federal agent and reporter John Carreyrou, who first exposed the issues in Theranos of The Wall Street Journal in 2015.
In the pre-trial motion filed on November 19, Balwani’s lawyers tried to strictly limit Cheung’s testimony in the trial, arguing that Cheung “has worked in Theranos for a total of six months after graduating from university” and was not eligible. Comment on the so-called problems in the laboratory.
“These’observations’ require obvious expertise in the field of laboratory testing, but Ms. Zhang lacks any such expertise,” the document said, claiming that when she testified in the Sherlock Holmes trial, “she was repeatedly involved in complex science There is no relevant professional knowledge or knowledge for issues and industry standards to express opinions.”
Assuming that Cheung once again stated his position in the Balwani trial, his lawyers almost fully knew what would happen due to her testimony in the Holmes case. McQuaid said this poses some risks to the government.
“You always want to minimize the number of witnesses giving testimony, because most people tell a story with different details,” she said. “A skilled defense attorney can skillfully use this difference in cross-examination to make the witness appear to be lying or sketchy in details. This can sometimes arouse enough suspicion to result in the acquittal of the jury.”
McQuade said that being able to see the details of the government case in the Holmes trial-and know the verdict-provided Balwani with an advantage that he would not have had if his trial proceeded according to his lawyer’s original request.
But she warned both parties in the Balwani case not to read too much about the judgment of Holmes.
“You never want to learn the lesson too well,” she said. “The fact that one jury found her guilty does not mean that another jury will find the other defendant guilty. I don’t think they should assume that the next jury will automatically find the same way.”
See how the great promise of Silicon Valley superstar Elizabeth Holmes to change the world failed. Watch the brand new 200day The episode of “America Greed” aired on CNBC on Wednesday, January 12th at 10pm Eastern Time.