It Was All Elizabeth Holmes’ Fault, Sunny’s Lawyers Claim

• “Elizabeth Holmes, not Sunny, founded Theranos and built Theranos”—Opening statement of Sunny Balwani defense counsel, Steve Cazares
• "I am responsible for everything at Theranos."—Sunny Balwani text message to Elizabeth Holmes read to jurors

With Elizabeth Holmes awaiting sentence for convictions on one count of conspiracy to commit wire fraud and three counts of wire fraud related to defrauding investors, her former Theranos co-founder and ex-lover Ramesh “Sunny” Balwani is now having his “day” in a Northern California federal court on similar charges.

The Balwani/Holmes Blame Game

The prosecution faces the burden of proving that Balwani and Holmes were partners in crime. Accordingly, Balwani’s lawyers are portraying their client as a mere investor in Theranos and blaming Holmes for everything that happened at the company. It’s basically the same strategy Holmes’ lawyers used in contending that the Theranos mess was all Balwani’s doing. Whether the strategy works this time around remains to be seen.

Advantage, Prosecution

So far, the jurors have been getting mixed messages. The prosecution’s first witness, former Theranos employee turned whistleblower Erika Cheung, described how she and her co-workers deliberately misled regulators about the accuracy of the company’s so-called Edison blood testing machines. We often answered to Balwani, Cheung testified. Even more dramatic were the text messages between Balwani and Holmes that the prosecution read aloud to the jury on April 5. “I worked six days and nights to help you. . . [and] I am responsible for everything at Theranos,” read one of the messages from Balwani to Holmes, reports NBC News. In another message, Balwani expressed how far he was willing to go for the company. Other messages between the pair read at the trial discussed meeting new investors, meeting revenue goals, and corporate plans, according to the NBC News report.

Advantage, Defense

But things went better for the defense the very next day, when former Schering-Plough Corp. executive Dr. Constance Cullen took the stand. The immunology expert who headed up test development at the pharma giant was also a witness at the Holmes trial. As she did earlier, Cullen testified that Theranos inappropriately attached Schering-Plough Corp’s logo to memos pitching its supposed breakthrough blood testing technology to Walgreen’s and potential investors. The use of the logo suggested that Schering-Plough, which is part of Merck, had validated Theranos’ claims about the capabilities of the technology. Cullen also testified that Holmes didn’t let other Theranos employees answer questions during meetings. Even when questions were posed directly to the employee, Holmes would interrupt the response and answer the question herself. According to a Wall Street Journal report, after the meeting, Holmes sent Cullen a validation report concluding that Theranos’ technology “has been shown to give accurate and precise results,” on Schering-Plough devices. Cullen said she never confirmed those findings but expected there to be follow-up meetings and conversations, but they never took place. Still, the prosecution couldn’t have been happy about what happened next. On cross-examination, the defense lawyers got Cullen to admit that she dealt with Elizabeth Holmes and other Theranos executives, but never met Balwani.