Convicted CEO Elizabeth Holmes asks for new trial | September 9, 2022 | Palo Alto Weekly | Palo Alto Online |

Palo Alto Weekly

News - September 9, 2022

Convicted CEO Elizabeth Holmes asks for new trial

Attorneys say chief prosecution witness had alleged misgivings about his testimony

by Sue Dremann

Attorneys for Elizabeth Holmes, the former Theranos CEO convicted of defrauding investors earlier this year, have asked a federal judge for a new trial in two separate filings just two days apart, according to court documents filed in U.S. District Court in San Jose.

In the first petition to the court for the Northern District of California, which was filed on Tuesday by Holmes' attorneys, is the latest twist in a storied case that found Holmes and former Theranos Chief Operating Officer Ramesh "Sunny" Balwani guilty of multiple felonies in a fraud that purported to accurately run tests based on a single drop of patients' blood.

A jury found Holmes guilty of four counts for defrauding investors of nearly $145 million through Theranos, a failed Palo Alto blood-testing startup, on Jan. 3. In a separate trial, Balwani was convicted of 12 counts of wire fraud and conspiracy to commit wire fraud on July 7. He is scheduled to be sentenced Nov. 15; Holmes is scheduled for sentencing on Oct. 17.

Holmes' attorneys are now asking for an Oct. 3 hearing regarding newly discovered "evidence" related to Dr. Adam Rosendorff, a key prosecution witness at Holmes' trial, or alternatively, for an evidentiary hearing.

Rosendorff allegedly left a voicemail message for one of Holmes' attorneys, Lance Wade, on Aug. 8 asking to meet with Holmes, according to the court filing. Wade didn't respond to Rosendorff due to ethical restrictions on communicating with parties represented by other attorneys, according to the petition.

About an hour and 15 minutes later, after not hearing back from the attorney, Rosendorff allegedly appeared at Holmes' residence. Her partner, William Evans, answered the door. Rosendorff was reportedly trembling and had his cellphone open when he sought to speak to Holmes, but Evans told him he had to leave. Rosendorff attempted to leave but drove his car in the wrong direction.

When Evans stopped him to give him directions, Rosendorff indicated he had misgivings regarding his testimony, according to the court filing. He allegedly stated during two short conversations that he tried to answer the questions honestly at Holmes' trial. He wanted to talk to Holmes and he thought a conversation with her would be "healing" for both of them. They were young at the time of the events; these concerns were weighing on him to the point where he had difficulty sleeping, according to the petition for the hearing.

Rosendorff was Theranos' laboratory director from April 2013 to November 2014. He was responsible for validating blood tests before they could be used on patients and negating tests if the results seemed inaccurate, ensuring the lab was complying with federal regulations and communicating with doctors who had questions or concerns about the test results.

During the trial, he testified as an expert witness for the prosecution in late September and early October of 2021. He testified that he felt pressured by management to defend laboratory tests that were inaccurate. The pushback caused him to leave Theranos, he said.

Holmes' attorneys sought to demolish his credibility and throughout the trial raised questions about whether prosecutors were only showing Rosendorff and the jury selected documents. Defense attorneys caught him in a number of contradictory statements made during testimony at other hearings.

Federal trial Judge Edward Davila allowed the defense attorneys to question Rosendorff about PerkinElmer, his employer at the time of the Holmes trial, which was found in violation of Centers for Medicare & Medicaid Services regulations by the same inspectors who audited Theranos, according to news reports from the trial.

Davila said at the time that Rosendorff might have "a personal interest or bias" to avoid career consequences or liability, which could have "focused or shaped" his testimony in the Holmes case.

Holmes' attorneys are now returning to these problematic portrayals of Rosendorff's testimony in their request for a new trial, which they allege amounts to prosecutorial misconduct or bias. The government chose to "cherry pick" evidence they presented and misled the jury; if all of the evidence had been presented, it would have resulted in an acquittal for Holmes, they claim.

On Wednesday, Holmes' attorneys filed another motion for a new trial. The former CEO claimed she had "new evidence" related to her relationship with Balwani, her co-conspirator and former lover.

In the court filing, she said that emails the government withheld between the prosecution team and other government personnel related to a lost database would "probably" have resulted in an acquittal at her trial.

During Holmes' trial, the defense claimed she was under Balwani's influence and that she was abused by him. The government, however, argued the couple were "co-equals" to prove conspiracy. She was convicted on that charge.

But during Balwani's separate trial, the government reversed its position and stated during closing arguments that he had influence over Holmes. Her attorneys now claim those arguments are admissible and are newly discovered evidence.

"The nature of Ms. Holmes' relationship with Mr. Balwani — and specifically the influence that he had over her — is also material to determining whether Ms. Holmes entered into a conspiracy with Mr. Balwani," a necessary element of one of the charges in her conviction, her attorneys said.

The government's statements, if admitted, probably would result in an acquittal because they would bolster Holmes' claims of his influence over her and reinforce her defense that she didn't conspire with him to commit wire fraud, Holmes' attorneys said. The new evidence also makes it likely that Holmes would be acquitted on the other three counts, which involved representations to potential investors in 2014.

Holmes' attorneys said she had sought the emails between the prosecutors and others on the government team, which were related to the loss of a Theranos database with testing and quality control data. The emails were relevant to the quality of the government's conduct in failing to preserve the data, her attorneys claimed.

Holmes originally filed a motion to force the government to give her the emails as she prepared for her trial, but the court rejected the motion. Five months later, attorneys for Balwani made a similar request to compel the government to produce the documents. The court eventually approved the motion for the documents because Balwani "articulated a specific defense" that allowed for a pretrial disclosure, the court said.

Holmes now claims the emails were "material" information that raised the probability of a favorable verdict because they would have undermined the quality of the government's investigation.

Holmes also filed a motion to have her case acquitted on Sept. 1, but it was rejected by the court on Tuesday.

The U.S. Attorney's Office could not immediately be reached for comment.

Email Staff Writer Sue Dremann at [email protected]

Comments

Posted by Hulkamania
a resident of Duveneck/St. Francis
on Sep 7, 2022 at 2:55 pm

Hulkamania is a registered user.

Cherry pick evidence? Both sides put information forward that will help their case. Looks like the defense didn't do their homework and present everything that would help their client.

Good luck on the do over. Maybe the defense can pump up their billable hours.


Posted by Annette
a resident of College Terrace
on Sep 8, 2022 at 1:20 pm

Annette is a registered user.

Ms. Holmes has an established credibility deficit. But she surely is creative.


Posted by Jennifer
a resident of another community
on Sep 8, 2022 at 5:06 pm

Jennifer is a registered user.

Con men/women usually are creative. You have to be to defraud investors. I agree with the prosecutor who said Balwani was the "perpetrator of the fraud." She was 18 when she met him. He's 57 and she's 38. Do I believe she was coerced into this? Probably. They're co-conspirators so they both need to sit and think about what they've done. In prison.


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