Erin Woo and Erin Griffith, The New York Times
Published: 2021-11-30 13:44:24 BdST
Ramesh Balwani, her former boyfriend and business partner, emotionally and physically abused her, Holmes testified in court Monday. He was controlling, she said, prescribing the food she ate, dictating every minute of her schedule and keeping her away from her family. And he forced her to have sex with him against her will, she said.
“He would force me to have sex with him when I didn’t want to because he would say that he wanted me to know he still loved me,” Holmes said on the stand, while crying.
It was the most dramatic moment in a three-month trial, with Holmes accused of lying and faking her way into hundreds of millions of dollars for her failed blood-testing startup, Theranos. Since September, prosecutors have tried to show a jury that Holmes, who presented herself publicly as a wunderkind of business and technology, had misled investors, doctors and patients about the efficacy of Theranos’ blood testing technology.
She was indicted in 2018 alongside Balwani, who is known as Sunny, her secret boyfriend for more than a decade and the former chief operating officer of Theranos. Last year, Holmes’ lawyers successfully argued to split their fraud cases; Balwani will be tried next year. At her trial’s start, Judge Edward Davila of US District Court for the Northern District of California, who is overseeing the case, instructed jurors not to speculate as to why Balwani was not present. Both have pleaded not guilty.
The trial has been held up as a parable of Silicon Valley hubris and “fake it till you make it” culture taken to a dangerous extreme. Few startup founders who stretch the truth to raise money or secure business deals are ever charged with fraud. A guilty verdict could embolden regulators to further crackdown on the tech industry at a moment when it has amassed enormous wealth and power. Holmes faces 20 years in prison if convicted.
With the new accusations about her relationship with Balwani, Holmes has potentially upended the narrative around her alleged wrongdoing and changed the jury’s perception of what happened. Her lawyers have painted Holmes as young, inexperienced and unqualified to run a research lab. They have only hinted at Balwani’s role in the fraud.
“Trusting and relying on Mr Balwani as her primary adviser was one of her mistakes,” Lance Wade, Holmes’ lawyer, said in opening statements in September.
Balwani has denied all accusations of abuse. His lawyers did not immediately respond to a request for comment.
Holmes, on the stand for the fourth day in her trial, also testified that her comments about Theranos’ relationship with the military — which the startup once said it had contracts with, even though it didn’t — had been misunderstood. She said she had not intended to mislead anyone during technology demonstrations or inspections. And she said that others were responsible for day-to-day management of Theranos’ lab.
But that was overshadowed by the details of her relationship, which she hid from the public while Theranos was on its fast-rising trajectory to a $9 billion valuation. Theranos collapsed in 2018 after a regulatory crackdown resulted in the company’s voiding two years of test results.
For months, trial-watchers have wondered whether Holmes would point fingers at Balwani as part of her defence, as her lawyers have hinted in filings that she might. They have also said they expect to call Mindy Mechanic, an expert witness who could testify about intimate partner abuse, to explain Holmes’ accusations.
Holmes met Balwani when she was 18 on a trip she took to China through Stanford University. He is 20 years older than her. After Holmes dropped out to start Theranos in 2003, she contacted Balwani, who comforted her after she said that she had been raped while a student at Stanford.
“He said that I was safe now that I had met him,” Holmes said. They began living together, and Balwani joined Theranos in 2009.
As Theranos grew, Holmes presented herself as confident and poised. But behind the scenes, she said, Balwani criticised and controlled her, pushing her to follow a strict daily regimen of prayers, tenets and green juice.
“He told me that I didn’t know what I was doing in business, that my convictions were wrong, that he was astonished by my mediocrity and that if I followed my instincts, I was going to fail,” she said, pausing to wipe her nose as she teared up.
Balwani frequently told her to kill her old self and “become a new Elizabeth” to be successful in business, she said.
Introducing such a defence complicates prosecutors’ case against Holmes. Throughout the trial, they have tried tying the alleged fraud at Theranos to Holmes by showing emails and text messages in which she was informed of the company’s problems.
Former employees have testified that she was a hands-on leader who micromanaged things like marketing copy and took charge in meetings with investors and partners. In earlier testimony, Holmes conceded that she had personally added the logos of pharmaceutical companies to reports that she sent to investors without the permission of the drugmakers.
Prosecutors also played a video of Holmes discussing the problems at Theranos in a TV interview. “I’m the founder and CEO of this company,” she said. “Anything that happens in this company is my responsibility at the end of the day.”
But Monday, Holmes depicted herself as a young woman manipulated by a controlling older boyfriend who claimed responsibility for her success.
“He impacted everything about who I was, and I don’t fully understand that,” she said, stuttering on the word “I.”
©2021 The New York Times Company