So began the federal trial Tuesday of Ramesh Balwani, the tech executive who is accused of defrauding patients and investors about Theranos, the blood testing startup he helped build. Balwani, who goes by Sunny, has pleaded not guilty to a dozen charges of wire fraud and conspiracy to commit wire fraud.
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Balwani’s lawyer started his opening statement by deflecting blame onto Holmes, who was the CEO of Theranos.
“Sunny Balwani did not start Theranos,” said the lawyer, Steve Cazares, from the Orrick firm. “He did not control Theranos.,
In January,
a federal jury convicted Holmes on four counts.
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Over the next 13 weeks or so, jurors will decide whether Balwani, 57, is guilty of the same charges.
Taking the stand in her defense, Holmes blamed Theranos’ problems and many of her own mistakes on Balwani, who was the startup’s president and chief operating officer.
At the heart of his trial is whether the government can prove that Balwani intended to defraud patients and investors with false claims about Theranos’ technology and business. The company raised nearly $1 billion from investors on the promise that its blood-testing devices would revolutionize health care.
In opening statements, prosecutors tried to tie Balwani’s actions directly to Holmes and to the deceptions at Theranos. Despite his lack of background in science and medicine, Balwani was put in charge of Theranos’ laboratory.
He also led Theranos’ relationship with Walgreens and oversaw the wildly overblown financial projections that Theranos gave investors, at one point claiming the company would make $1 billion in revenue in a year when its income was negligible.
Balwani’s lawyers veered from the playbook of Holmes’ defense. In his opening statement, Cazares argued that individual patient testimony and test results were insignificant without considering all of Theranos’ patient data, which had been in an encrypted database of 9 million patient test results.
Theranos provided a copy of the database to federal prosecutors in 2018, after a grand jury subpoena, but the government was never given the encrypted key needed for access to the information. Theranos destroyed the database that same year.
Cazares argued that the government had neglected to analyze that data.
This article originally appeared in
The New York Times.
