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Former Theranos President Ramesh Balwani’s Trial Further Delayed Due to Coronavirus Surge in California

Former Theranos President Ramesh Balwani’s Trial Further Delayed Due to Coronavirus Surge in California

  • His ex-girlfriend, founder and CEO Elizabeth Holmes, was found guilty on four charges of defrauding investors of criminal fraud for her role in building the blood-testing startup.

The trial of Ramesh “Sunny” Balwani, former president of Theranos Inc., a health care and life sciences company in Palo Alto, California, and ex-boyfriend of founder and CEO Elizabeth Holmes, has further been delayed. The Mercury News reported that the trial, which had been scheduled to start in February, will be delayed because of “a surge in Covid cases in California.” Quoting Judge Edward Davila in San Jose, the report said that “the trial may be pushed to March.” Previously, the trial was postponed to Feb. 15 from Jan. 11, due to the lengthy trial of Holmes, which went on for nearly eight weeks.

Last week, Holmes was found guilty on four charges of defrauding investors of criminal fraud for her role in building the blood-testing startup into a $9 billion company that collapsed in scandal. She was found not guilty on three additional charges concerning defrauding patients and one charge of conspiracy to defraud patients. The jury returned no verdict on three of the charges concerning defrauding investors.CNN reported that Judge Davila, “who is presiding over the case, is expected to declare a mistrial on those charges.”

Holmes, now 37, had founded Theranos in 2003 as a 19-year-old college dropout and was hailed and celebrated as a Silicon Valley whiz-kid. The Palo Alto, California-based Theranos was aiming to revolutionize medical laboratory testing through allegedly innovative methods for drawing blood, testing blood, and interpreting the resulting patient data to improve outcomes and lower health care costs.

Holmes and Balwani were originally charged in June 2018 on two counts of conspiracy to commit wire fraud and nine counts of wire fraud. According to the indictment unsealed on June 15, 2018, Holmes and Balwani had engaged in a multi-million dollar scheme to defraud investors and a separate scheme to defraud doctors and patients, and both schemes entailed promotion. If convicted, each of them could face 20 years in prison and fines of $250,000, plus restitution, for each count of wire fraud and for each conspiracy count.

The Mercury News reported that Balwani’s lawyer, Jeffrey Coopersmith, objected to the delay. According to the report, “he argued citizens in Santa Clara County, where the court is based and which has a vaccination rate of above 90 percent, are enjoying National Hockey League Sharks games, concerts, restaurants and bars.” Adding that his client has been “waiting for a long time,” Coopersmith stated that the delay is unnecessary.

During her testimony, Holmes accused Balwani of emotionally and sexually abusing her, which apparently compromised her judgment during the time of the alleged crimes. Holmes made the accusations during her much-anticipated testimony on Nov. 29, in an attempt to refute accusations that she lied about a flawed blood-testing technology, which she had touted as a breakthrough.

She blamed Balwani for allegedly exploiting, using and misleading her. Holmes was 18 when she met Balwani, then 38, during a trip to China. She told the court that what began as a professional relationship eventually turned amorous. The two became romantically involved in 2005 before Balwani became the chief operating officer at Theranos, a position he held from 2009 to 2016. They were together for 12 years.

In an effort to blame her ex-boyfriend for her mental state during the times she committed fraud, Holmes testified that her rape at Stanford played a role in her being subservient to Balwani. She told the court that after the incident, she stopped attending classes and immersed herself into building her company instead. “I was questioning what — how I was going to be able to process that experience and what I wanted to do with my life,” she told the court, according to news reports. “I decided that I was going to build a life by building this company.” Holmes mentioned that later when she told Balwani the trauma of her rape at Stanford, he told her she was safe, now that had met him.

However, the picture she painted of her ex-boyfriend was far from being a safety anchor for her. She told the court that he berated her and controlled her. When he was upset with her, he forced her to have sex with him, to show her that he loved her. “He told me that I didn’t know what I was doing in business, that my convictions were wrong, that he was astonished at my mediocrity,” she said, adding that he told her that she needed “to kill the person” if she was to become successful. “He felt like I came across as a little girl and thought I needed to be more serious and more pointed.”

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Holmes explained that Balwani had demanded that she follow rules he laid out for her like spending at least 30 minutes each morning writing out her daily goals and never spending more than five minutes meeting with anyone unless she had written down a reason justifying the additional time. If she didn’t do what Balwani said, Holmes said, he would yell and tell her he was “so disappointed in my mediocrity.”

At other times, Holmes said, Balwani would liken her to a “monkey flying a spaceship” and tried to cut her off from her family in an alleged effort to ensure that she devoted herself full-time to Theranos. She also said he controlled her diet in an attempt to keep her “pure.” She told the court that Balwani “wasn’t who I thought he was,” and that he “impacted everything about who I was and I don’t fully understand that.”

During Holmes’ Nov. 29 testimony, prosecutors released more texts between her and Balwani, which shed light on their past relationship and efforts to keep Theranos afloat amid scrutiny. Business Insider describes the texts, sent from 2013 to 2016, as “mundane, including flight details and food orders, to the zealous.”

Balwani has pleaded not guilty and has denied Holmes’s abuse allegations, “which were an important part of the testimony she gave at her trial but aren’t expected to re-surface at his,” according to Bloomberg Law.

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