Theranos Take 2: What you need to know as Sunny Balwani’s fraud trial begins
Sunny Balwani’s name came up a lot in Elizabeth Holmes’ fraud trial. Now Theranos’ second highest-ranking executive, and Holmes’ former boyfriend, is about to face his day in court.
Jury selection in Balwani’s fraud trial is scheduled to begin Wednesday. It follows January’s conviction of Holmes on four counts of defrauding investors. (The Theranos founder was acquitted on four counts of defrauding patients, while the jury deadlocked on three other investor counts.)
Balwani, who was president and chief operating officer of the company, faces the same charges as Holmes, and has pleaded not guilty.
Whereas Holmes was once among the most admired tech CEOs for her blood-testing startup that garnered a $9 billion valuation from investors, Balwani maintained a lower-profile.
At Theranos, he developed a reputation as a harsh boss, who grew increasingly concerned employees would steal trade secrets. Holmes, in her testimony, accused him of abuse, including controlling her diet and berating her when he felt she lacked confidence. Balwani has denied the accusations. He is not expected to testify at his trial.
Balwani, now 57, and Holmes, now 38, met when they were studying in China the summer before her freshman year at Stanford University. He joined Theranos in 2009.
Like Holmes, Balwani is accused of defrauding investors and patients over a five-year period, claiming that Theranos’ analyzer could perform a wide range of tests from a finger-prick blood at faster speeds than the competition. It couldn’t. Prosecutors say that like Holmes, Balwani knew about the reliability and accuracy problems.
Both of the company’s principals are facing up to 20 years in prison as well as financial penalties. Holmes’ sentencing is scheduled for this fall.
Why is the Theranos trial just taking place now?
Theranos dissolved in 2018 following a number of civil and criminal probes. And prosecutors wanted to try Holmes, the public face of the company, first. The pandemic forced several delays, then things got pushed back even further when Holmes informed the court she was pregnant.
Can I watch Balwani’s trial online?
No. As was the case with Holmes’ trial, public access will be in-person only (including an overflow room at the courthouse). There will be no live remote public access, via Zoom or telephone.
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