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Text Messages Between Theranos Founder Elizabeth Holmes and Ex-Boyfriend Ramesh “Sunny” Balwani Grab Headlines in Early Days of Fraud Trial

Romantic musings between the now-defunct Theranos’ CEO and COO may be introduced to undercut Holmes’ claims of ‘intimate partner abuse’

Medical laboratory professionals did not have to wait long for the first prosecution bombshell to explode during the opening week of the federal criminal fraud trial of former Theranos CEO Elizabeth Holmes.

In court filings leading up to the September 8 trial in San Jose, Calif., Holmes’ defense team revealed plans to claim “intimate partner abuse” by Holmes’ then boyfriend, Theranos Chief Operating Officer Ramesh “Sunny” Balwani. The plan was for Holmes to testify that Balwani threw “sharp” objects at her and controlled how she ate and dressed, impacting her “state of mind” at the time of the alleged crimes.

But prosecutors countered that claim by releasing six pages of text messages between the former couple, which took place between May 2015 and July 2015, as Theranos became the target of whistleblower accusations and a company employee who began secretly speaking to the Wall Street Journal (WSJ). Later that year, the WSJ published an investigative report that brought to light questions about Theranos’ blood-testing technology and the faulty clinical laboratory test results it reported to physicians and patients.

Holmes and Balwani kept their relationship hidden from the public, but their private text messages reveal intimate exchanges that likely will be introduced by prosecutors to undercut Holmes’ claims of abuse.

Within the 164 text messages were these exchanges:

  • “You are breeze in desert for me” [Holmes]
  • “My water” [Holmes]
  • “And ocean” [Holmes]
  • “Meant to be only together tiger” [Holmes]
  • “Madly in love with you and your strength” [Holmes later that day]

The following day:

  • “On route to dinner. Missing you” [Holmes]
  • “Missing you too” [Balwani]
  • “You more” [Holmes]

Balwani then turned his attention to the whistleblower within Theranos:

  • “I’m narrowing this down in CLIA. Down to 5 people. Will nail this mother [explicative omitted]” [Balwani]
  •  “Who do u think” [Holmes]
  • “Now we have legal grounds” [Holmes]
  • “Yes” [Balwani]

Later Holmes texted:

  • “Feel like the luckiest person in the world BC I have you” [Holmes]
  • “We will come up with good responses to the questions and we will turn this around” [Balwani]
  • “Love” [Balwani]
  • “Transcend” [Holmes]
  • “We will” [Balwani]

The following month:

  • “Onboard. Love.” [Balwani]
  • “Taking off baby” [Balwani]
  •  “Missing you” [Holmes]
  • “Missing you too baby. Just arrived at the office. Will prepare” [Balwani]
  • “Xxx” [Holmes]
Elizabeth Holmes and Ramesh Balwani

Prosecutors in the federal fraud trial of former Theranos CEO Elizabeth Holmes (above, left) have included in a court filing 180 text messages sent between Holmes and former Theranos COO Ramesh “Sunny” Balwani (above, right) that reveal their romantic involvement and efforts to unearth the whistleblower within the failed blood-testing company. (Photo copyright: Yichuan Cao/NurPhoto via Getty Images [Holmes], Justin Sullivan/Getty Images [Balwani].

Does Affection Rule Out Abuse?

In San Francisco, KPIX 5 television reported that legal experts predict the texts may not have the impact in the trial that outside observers expect, since, they said, expressions of affection do not rule out the possibility of an abusive relationship, which is expected to be one aspect of Holmes’ defense strategy.

Holmes, 37, who according to court documents faces 10 counts of wire fraud and two counts of conspiracy to commit wire fraud, is alleged to have misled investors, clinical laboratories, patients, and healthcare providers about Theranos’ proprietary blood-testing technology, which Holmes claimed could perform hundreds of medical laboratory tests using only a finger-prick of blood. If convicted, Holmes could face up to 20 years in prison, fines, and payment of restitution. She has pleaded not guilty.

Testimony of Theranos’ Corporate Controller

The prosecution opened the trial with questioning of Theranos’ longtime corporate controller Danise Spivey Yam. According to The Wall Street Journal, Yam testified she provided revenue projections to a company hired to value Theranos stock that ranged from $50 million in 2013 to nearly $132 million in 2016. Those numbers were much more modest than company projections of $140 million in revenue in 2014 and $990 million in 2015, which were given to investors.

“Do you have any idea where that number came from?” Assistant US Attorney Robert Leach asked Yam.

“No,” Yam replied, adding that she hadn’t helped prepare it.

Former Theranos employee Erika Cheung, who according to court testimony worked in the company’s laboratory testing blood samples, testified that she left Theranos after six months because of concerns over Theranos’ blood-testing practices and data manipulation when machines failed quality tests.

Cheung ultimately alerted federal regulators to the company’s failure to meet industry standards and expressed her concerns about Theranos’ Edison mini-blood-lab machine.

“You’d have about the same luck flipping a coin as to whether your results were right or wrong,” Cheung testified about the accuracy of the Edison, CNBC reported. “It was concerning to see this degree of failure; this was not typical for a normal lab.”

After leaving Theranos, Cheung co-founded the nonprofit Ethics in Entrepreneurship.

During cross examination, CNBC noted that one of Holmes’ defense attorneys highlighted the professional qualifications of Theranos lab directors and other scientists at Theranos, including 52 scientists with PhDs and 10 medical doctors. He also noted that the validation reports for assays that Cheung had testified were problematic had been approved for lab use by a lab director and vice president, not Holmes.

With more than 200 witnesses expected to testify, the ongoing Holmes fraud trial is estimated to last three to six months. Pathologists and clinical laboratory scientists who are following the Theranos fraud trial with keen interest can look forward to more Dark Daily coverage. Click here to read our previous coverage of the Holmes/Theranos medical laboratory fraud saga.

Andrea Downing Peck

Related Information

Case 5:18-cr-00258-EJD Document 1005-4 Filed 09/07/21

United States v. Elizabeth A. Holmes, et al. 18-CR-00258-EJD

Case 5:18-cr-00258-EJD Document 973

Hot Startup Theranos Has Struggled with Its Blood-Test Technology

Texts between Theranos Founder Elizabeth Holmes, Ex-Boyfriend Add New Layer to Fraud Trial

Elizabeth Holmes Trial: Theranos Gave Investors Rosy Picture of Revenue, Witness Says

What Exactly Was the Theranos Edison Machine Supposed to Do?

Theranos Whistleblower Testifies Blood-Test Machines Were about as Accurate as a Coin Toss

Former Theranos Lab Worker Testifies About Data Manipulation

Theranos Founder and Former CEO Elizabeth Holmes’ Federal Criminal Fraud Trial Finally Is Under Way in California

On-demand Video Service Hulu Gets Underway on TV Miniseries Documenting Rise and Fall of Former Theranos CEO Elizabeth Holmes

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Former Theranos CEO Elizabeth Holmes Is Pregnant, Causing a Further Delay in Her Trial Date

Theranos CEO Elizabeth Holmes Trial Delayed Again, This Time Due to COVID-19 Restrictions, as Lawyers Battle Over Destroyed Clinical Laboratory Test Evidence

Theranos Founder and Former CEO Elizabeth Holmes’ Federal Criminal Fraud Trial Finally Is Under Way in California

Court documents show Holmes’ defense strategy includes accusing ex-boyfriend and former COO Balwani of ‘intimate partner abuse’ that impacted her ‘state of mind’

It has started! The long-awaited criminal trial of former Theranos CEO Elizabeth Holmes is underway in a federal courthouse in Silicon Valley. Across the profession of medical laboratory medicine, there is keen interest in the story of Holmes and her now-defunct clinical laboratory company Theranos.

This next chapter in the drama began on September 8 with opening arguments. Federal prosecutors came out strong, claiming Holmes was “a manipulative fraudster who duped investors and patients alike and knew the whole time that she was hoodwinking them,” according to NPR.

“This is a case about fraud, about lying, and cheating to get money,” said Assistant US Attorney Robert Leach, NPR reported. “It’s a crime on Main Street, and it’s a crime in Silicon Valley,” he added.

Not surprisingly, Holmes’ defense team had a different take, claiming Holmes was simply “a hardworking, young startup executive who believed in the mission of the company, only to see it buckle in the face of business obstacles,” NPR reported. “They argued that she placed blind faith in the No. 2 executive at the company [Balwani] and overly trusted lab directors, who the defense team says were legally responsible for how the labs were run.”

Holmes Claims Abuse at the Hands of Former Theranos COO Balwani

Many pathologists and clinical laboratory managers are ready to watch and learn what unfolds in the opening stages of Holmes’ long-delayed federal criminal fraud trial. During the jury selection process, recently unsealed court documents showed that Holmes’ defense planned to include claims she was abused by her then boyfriend, Theranos Chief Operating Officer Ramesh Balwani.

This surprising development adds yet another twist to the tale of the disgraced Silicon Valley executive and her defunct clinical laboratory testing company.

The hype surrounding the once-high flying startup, which in 2015 reached a peak valuation of $9 billion, began unraveling that same year when a Wall Street Journal (WSJ) investigation exposed the company’s alleged deceptions and questionable practices related to its finger-prick blood-testing technology.

Fast-forward six years—Theranos is now gone but its top executive continues to make headlines, not as a laboratory science wunderkind, but as a criminal defendant.

Holmes, 37, has pleaded not guilty to all charges. Her former consort and ex-Theranos COO Ramesh Balwani also pleaded not guilty to all charges. He will be tried separately from Holmes.

Elizabeth Holmes and her husband William Evans

Elizabeth Holmes, founder and former CEO of defunct clinical laboratory testing company Theranos, is seen leaving the Robert F. Peckham US Courthouse with husband William Evans following opening arguments in her federal trial on September 8. (Photo copyright: Reuters/Peter DaSilva.)

Dozens of Potential Jurors Removed for Alleged Bias

On August 31, in-person questioning of prospective jurors began in Holmes’ federal fraud trial in San Jose, California. The process did not go well. As CNBC reported, dozens of potential jurors were removed from the jury pool due to potential bias in the case.

“Thirty to forty of the remaining jurors have consumed substantial, and I mean lengthy extrajudicial material, about the case and about the defendant,” defense attorney Kevin Downey, JD of Washington, D.C.-based Williams and Connolly, LLP, told Judge Edward Davila, CNBC reported. “We’re very vulnerable to any of the jurors commenting in some ways as either the court or lawyers conduct voir dire about the content of the media they’ve seen.”

Voir dire is the legal term for preliminary examinations of jurors, which in this initial screening was done by reviewing potential juror questionnaires.

Holmes’ defense attorneys, according to CNBC, previously expressed concerns about “inflammatory” media coverage of the case. However, Assistant US Attorney Jeffrey Schenk maintained, “Less than half of the individuals that filled out the questionnaire had prior exposure to Holmes and Balwani. One juror saying something during the voir dire process that could be overheard is a risk in every court case,” CNBC reported.

Holmes Claims ‘Mental Condition Bearing on Guilt’

A report by the Independent notes that newly unsealed court documents which were first reported by NPR reveal that Holmes will mount a defense that includes claims of “intimate partner abuse” by Balwani, 56, during their past relationship.

 “The documents show that Ms. Holmes will describe how Mr. Balwani controlled what she ate and drank, how she dressed, and who she spoke to, while also alleging he threw ‘sharp’ objects at her,” the Independent reported.

NPR reported that court documents indicate Holmes is likely to take the stand and testify at her trial. She will not be presenting an insanity defense but will put forth a “defense of a mental condition bearing on guilt” that was the result of partner abuse and that impacted her “state of mind” at the time of the alleged crimes.

Court documents filed by Balwani’s defense attorneys label Holmes’ allegations as “salacious and inflammatory.”

“In truth, Ms. Holmes’ allegations are deeply offensive to Mr. Balwani, devastating personally to him and highly and unfairly prejudicial to his defense of this case,” defense attorney Jeffrey Coopersmith, JD, Principle and founder of Coopersmith Law and Strategy, wrote in the filing.

The Theranos Saga Continues …

In “Former Theranos CEO Elizabeth Holmes Is Pregnant, Causing a Further Delay in Her Trial Date,” Dark Daily reported that Holmes’ trial had been delayed multiple times since she was first was indicted on 11 counts of wire fraud and conspiracy to commit wire fraud in 2018. The COVID-19 pandemic, and more recently Holmes’ pregnancy, delayed the start of her trial until August.

CNBC reported that Holmes gave birth on July 10, 2021, in Redwood, California. The baby’s father is William Evans, heir to the Evans Hotels chain in California, The Sun reported.

Balwani’s criminal fraud trial is scheduled to begin with jury selection on January 11, 2022. Both Holmes and Balwani face maximum penalties of 20 years in jail and a nearly $3 million fine, plus possible restitution if found guilty on all counts.

It is a rare thing for owners of a clinical laboratory company accused of fraud to come to trial and receive so much media attention. In the weeks leading up to the trial, medical laboratory managers and pathologists could read a wide variety of news stories about the impending trial and the legal strategies expected by the attorneys for both the plaintiffs and the defendants.

Thus, everyone interested in this trial and its outcome will likely have the equivalent of a front row seat because so many journalists are covering this trial.

Andrea Downing Peck

Related Information

Hot Startup Theranos Has Struggled with Its Blood-Testing Technology

Dozens of Potential Jurors in Elizabeth Holmes Trial Cut for Potential Bias

Case 5:18-cr-00258-EJD Document 973

Case 5:18-cr-00258-EJD Document 976

Elizabeth Holmes Claims Abuse by Ex-Boyfriend Who Controlled What She Ate in Theranos Fraud Trial Defense

Elizabeth Holmes Plans to Accuse Ex-Boyfriend of Abuse at Theranos Fraud Trial

Elizabeth Holmes Gives Birth as Fraud Theranos Fraud Trial Nears

Former Theranos CEO Elizabeth Holmes Is Pregnant, Causing a Further Delay in Her Trial Date