Closing Statement Start of Sunny Balwani Experiment

For many months, Ramesh BalwaniThe lawyers tried to distinguish him from Elizabeth Holmeshis ex-girlfriend and business partner at the failed blood testing company Theranos.

Miss Holmes was guilty defrauding startup investors in January. Mr. Balwani is looking for another result in his own fraud trial.

But on Tuesday, at the conclusion of Mr Balwani’s jury arguments, prosecutors charged him directly with Ms Holmes and the years-long fraud at Theranos. Jeffrey Schenk, assistant US attorney and lead prosecutor in the case, displayed a text message Mr Balwani sent Ms Holmes in 2015 and was used as evidence in the trial.

“I am responsible for everything at Theranos,” Balwani wrote. “It’s all up to me to decide.”

The text was an admission of guilt, Mr. Schenk said, adding, “He admitted his role in the scam.”

The presentation was limited to more than three months of testimony during Mr. Balwani’s trial, largely mirroring Mrs Holmes’s last fall. In 2018, she and Mr. Balwani, 57, were accused of exaggerating the capabilities of the blood-testing machine and the performance of Theranos’ business when in reality, the products weren’t working and its business was suffering. difficult. The couple pleaded not guilty. Mrs Holmes was convicted of four of the 11 counts.

The trial of Mr Balwani, who became known as Sunny, was without fanfare about Mrs Holmes’ case. However, it serves as a coda for a waning era of startup growth often rely on exaggeration and exaggeration. Ms. Holmes and Mr. Balwani are among the few tech executives ever indicted on fraud charges.

Just as Miss Holmes was trying to blame the deceptions at Theranos on others, Mr. Balwani pointed the finger squarely at her. Throughout the trial, his lawyers argued that Theranos’s many blood tests were fruitful. They say Mrs Holmes, not Mr Balwani, controlled Theranos. And on Tuesday, they painted Mr. Balwani as a true believer in Theranos’ vision and technology.

Mr. Balwani “puts his heart and soul into Theranos,” said Jeffrey Coopersmith, who represents him. “He worked tirelessly, year after year, to make the company a success.”

Ms. Holmes, now 38, met Mr. Balwani when she was 18. They began dating years later, after Holmes founded Theranos. Mr. Balwani joined Theranos in 2009, became the company’s chief executive officer, and eventually invested $4.6 million in the company and was in charge of its laboratory. The couple keep their relationship a secret and live together in a large home they co-own in Atherton, California.

In 2016, after Theranos was fired for lying about his blood-testing abilities, Mr. Balwani left the company and split with Mrs. Holmes. The two were accused of fraud together, but Ms Holmes argued in the filing to cut the case and accuse Mr Balwani of emotional and sexual abuse. Her testing includes Dramatic testimony recounts accusations. That subject was excluded from Mr. Balwani’s trial.

To convict Mr. Balwani, prosecutors had to convince jurors that he intentionally lied to investors and patients about Theranos’ blood tests and business dealings.

Prosecutors tried to blame Mr. Balwani for the financial projections Theranos presented to investors and the state of its labs. The new witnesses include investors and executives who dealt directly with Mr. Balwani, rather than Ms. Holmes.

One forecast, presented to investors in October 2014, showed Theranos to bring in $140 million that year. In fact, the revenue was $150,000. The next year, Mr. Balwani projects nearly $1 billion in sales from pitches to investors. Theranos’ insider predictions are much lower, the evidence shows, and are in fact $429,210.

Mr. Schenk said Theranos leaders have directed its scientists to validate the blood tests and only start making the tests available to the public when they need money from investors or customers. “Not when the science is ready,” he said.

A new witness, Patrick Mendenhall, who dealt directly with Mr Balwani while investing in Theranos, has outlined promises that have become false or untrue.

Brian Grossman, an investor at hedge fund PFM Health Sciences who was also a witness in Holmes’ trial, testified that Mr. Balwani provided his team with over-exaggerated financial projections. expected revenue of Theranos.

“When Mr. Balwani communicates with an investor, that is the intent, and the purpose is to trick them for money,” Mr. Schenk said.

Prosecutors also highlighted Mr. Balwani’s role in running Theranos’s lab, which moderators called a “disaster zone” in a 2014 text message. Mr. Balwani will also be “removed” dissent” by threatening or pushing out employees who expressed concern about Theranos’ trials, as Dr. Adam Rosendorff, a former laboratory director who testified in both trials, Mr. Schenk speak.

Mr Coopersmith, the defense attorney, said the government painted a “highly misleading” picture of Mr Balwani’s time at Theranos and that it was unfair to display private texts out of context. Evidence of a conspiracy.

Mr. Coopersmith said the messages did not show Mr. Balwani telling anyone to commit the fraud. “If there was a conspiracy, you would think there would be all sorts of conspiratorial, sinister conversations, and just no,” he said.

Notably absent from the witness stand were James Mattis, former defense secretary and Theranos board member, and Ms Holmes, who both testified in Ms Holmes’ trial. Mr. Balwani did not testify in his defense.

If convicted, Mr Balwani and Mrs Holmes will be sentenced together in September.

Erin Woo contribution report.

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