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For months, Ramesh Balwanihis lawyers tried to separate him from the others Elizabeth Holmesex-girlfriend and business partner at failing blood testing company Theranos.
Mrs. Holmes found guilty For defrauding the investors of the newly formed company in January. Mr. Balwani is looking for a different result own fraud case.
But on Tuesday, in the closing statements of Mr. Balwani’s case, prosecutors linked him directly to Ms. Holmes and years of fraud at Theranos. Jeffrey Schenk, the US assistant attorney and chief prosecutor of the case, cited a text message that Mr Balwani sent to Ms Holmes in 2015, which was used as evidence in the case.
“I am responsible for everything on Theranos,” Mr. Balwani wrote. “They were all my decisions.”
“He acknowledges his role in the fraud,” said Mr Schenk, noting that the text message was a confession of guilt.
The presentation spanned more than three months of testimony in Mr Balwani’s case, largely reflecting Mrs Holmes’ testimony last fall. In 2018, Ms. Holmes and Mr. Balwani, 57, were accused of exaggerating the features and business performance of Theranos’ blood testing machines, but the products actually didn’t work, making things difficult. The duo pleaded not guilty. Ms. Holmes was found guilty on four of the 11 charges.
The case of Mr. Balwani, known as Sunny, lacked the fanfare of Ms. Holmes’ high-profile case. It still serves as a coda. declining period of initial growth this was often based on exaggeration and exaggeration. Ms. Holmes and Mr. Balwani are among the very few technology executives prosecuted for fraud.
As Ms. Holmes tried to blame others for the deceptions on Theranos, Mr. Balwani pointed a finger at her. Throughout the trial, his lawyers argued that most of Theranos’ blood tests worked. And they said Mrs. Holmes controlled the Theranos, not Mr Balwani. They would begin closing discussions later on Tuesday.
Ms. Holmes, now 38, met Mr. Balwani when she was 18. They started dating years after Miss Holmes founded Theranos. In 2009, Mr. Balwani invested in Theranos and became the company’s chief operating officer and eventually took charge of its laboratory. The couple kept their relationship a secret and lived together in a sprawling joint-owned house in Atherton, California.
In 2016, after Theranos came under criticism for lying about their ability to take blood tests, Mr. Balwani left the company and broke up with Ms. Holmes. The couple was accused of committing fraud together, but Ms. Holmes argued in the lawsuits to separate the cases, accusing Mr. Balwani of emotional and sexual harassment. including trial dramatic testimony describing the accusations. This issue was excluded from Mr. Balwani’s case.
To convict Mr. Balwani, prosecutors must convince jurors that Theranos deliberately lied to investors and patients about blood tests and business deals.
Prosecutors tried to blame Mr. Balwani for the financial forecasts Theranos showed to investors and the state of his labs. Among the new witnesses were investors and executives who were directly involved with Mr. Balwani rather than Ms. Holmes.
A projection made available to investors in October 2014 showed Theranos would bring in $140 million that year. In reality, income was limited. The following year, Mr. Balwani projected around $1 billion in revenue for investors in the fields. Evidence suggests that Theranos’ internal estimates were much lower and the reality was close to zero.
The promises made turned out to be misleading or false, said Patrick Mendenhall, a new witness who dealt directly with Mr. Balwani when he made an investment in Theranos.
Brian Grossman, an investor in hedge fund PFM Health Sciences, who was also a witness in Ms. Holmes’ case, said Mr Balwani had provided his team with financial projections that far exceeded Theranos’ projected revenue.
“When Mr Balwani contacts an investor, it is for a purpose and the aim is to trick them into getting money,” said Mr. Schenk.
Prosecutors also highlighted Mr Balwani’s role in managing Theranos’ lab, which the administrator referred to as a “disaster zone” in a 2014 text message used as evidence. Mr Schenk said Mr Balwani would “eliminate opposition” by intimidating or kicking out employees who have expressed concern about Theranos testing.
Notably, James Mattis, former defense secretary and Theranos board member, and Ms. Holmes, who had both testified in Ms. Holmes’ trial, were not present on the witness stand. Mr. Balwani did not testify in his own defense.
If found guilty, Mr. Balwani and Ms. Holmes will be convicted together in September.
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