GUILTY CA - Ramesh “Sunny” Balwani, 56, (Theranos), wire fraud charges

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Friday, April 29th:
*Motions Hearing (@ 8:30am PT) & *Trial continues (Day 14) (@ 9am PT) - CA – *Ramesh “Sunny” Balwani (53/now 56) (CFO & President of Theranos) indicted & charged (6/14/18) & arraigned (6/15/18) with 9 counts of wire fraud & 2 counts of conspiracy to commit wire fraud. Another count of wire fraud was added in 2020, bringing the total number of felony charges to 12. Plead not guilty. No bond. Faces a maximum sentence of 20 years in prison & a fine of $2.75 million, plus restitution, & $250K for each individual count of wire fraud & conspiracy. Plead Not guilty.
Federal Court 5:18-cr-00258-EJD-2 / SEC 5:18-cv-01603 filed 3/14/18 pending; plead not guilty.
Defrauding investors out of $700 million in funding for their blood-testing startup Theranos.
Trial began on 3/22/22. Jury: 12 jurors (6 women & 6 men) & 6 alternates (2 women & 4 men). 3/21/22: Jury #1 sick, alternate moves to jury. 12 jurors (6 women & 6 men) & 5 alternates (2 women & 3 men). Trial Court will be in session on Tuesdays, Wednesdays & Fridays (from 9-3), but the jury may be asked to come in on some Mondays & Thursdays as well. Trial dates so far: 4/29 with motions hearing @ 8:30am, 5/3, 5/4, 5/10, 5/11, 5/13, 5/17, 5/18, 5/20, 5/27, 6/7 & 6/8/22.
Indictment & court info from 4/11/20 thru 3/8/22 & Jury selection (Day 1-4) 3/9/22 to 3/15/22 & 3/16 to 3/21/22 & Trial Days 1-2 (3/22 to 3/23/22) & hearing on 3/29/22 & 4/12/22 & Trial Days 3-12 (3/30 to 4/26/22) reference post #133 here:
CA - Ramesh “Sunny” Balwani, 56, (Theranos), wire fraud charges
4/27/22 Wednesday, Day 13: Government witnesses: Lisa Peterson, DeVos family wealth manager continues on stand for cross exam.
for more info see post #138 here:
CA - Ramesh “Sunny” Balwani, 56, (Theranos), wire fraud charges
Ex-lab director & consultant Dr. Sunil Dhawan (& Balwani's dermatologist).
for more info see post #139 here:
CA - Ramesh “Sunny” Balwani, 56, (Theranos), wire fraud charges
Motion to exclude hearing @ 8:30am & trial continues on Friday, 4/29/22 @ 9am.
*Elizabeth A. Holmes (34/now 37) (CEO of Theranos) – Trial began on 9/8/21 & ended 1/3/22 with a verdict of guilty on 4 counts of 11. Next sentencing hearing on 9/26/22.
 
Well I'm sorry folks but the last tweet to do with the trial from DA was:

Dorothy Atkins@doratki
Apr 28

Dhawan said he attended the beginning of Theranos' 2014 CMS lab inspection, but didn't make any kind of presentation. He says he didn't know that Theranos was collecting samples in Pennsylvania, or that Theranos had another part-time lab director at the time Dr. Lynette Sawyer.


DA just up and left the building so to speak. Very strange! Ah well, I'll keep checking back to see if she returns!
 
Dorothy Atkins@doratki
4h

Good morning from a San Jose! I'm here in court for Sunny Balwani's fraud trial. The attorneys are already arguing over admitting exhibits - including a 2013 recording of Elizabeth Holmes' call w/ investors. Unexpectedly, the gov't doesn't want to play it, but the defense does.

Dorothy Atkins@doratki
4h

Although the gov't played the recording multiple times in Holmes' trial, prosecutors say it's unnecessary to play the recording in Sunny Balwani's trial. Balwani's counsel disagrees, and says the jury should hear what Holmes' said as opposed to what an investor recalls she said.

Dorothy Atkins@doratki
3h

The judge didn't rule on the issue, and told the defense to give their request some more thought. He told the defense repeatedly that if they are going to argue Holmes' statements on the call are true, "there’s some caution with that."

Dorothy Atkins@doratki
3h

Jury's back and we've got a new witness (who didn't testify in Elizabeth Holmes' trial)! Patrick Mendenhall, the CEO of investment firm U.S. Capital Advisors LLC, is on the stand. He invested in Theranos in 2005 and 2013 and Sunny Balwani was his primary contact.

Dorothy Atkins@doratki
3h

Mendenhall says he first heard about Theranos in 2005 from his advisor, David Harris, who knew Elizabeth Holmes' family. "When it came it across my desk, I thought these guys were smart guys, and so I decided to invest a lite bit with them," but he knew it was "very speculative."

Dorothy Atkins@doratki
3h

Mendenhall says 7 years after investing into Theranos he hadn't heard from the company and rode off his initial $50k investment as a loss, but in 2013 Theranos sent out press statements & he thought "this was probably the most incredible investment opportunity that one can see."

Dorothy Atkins@doratki
3h

After a 45 min call with Balwani, Mendenhall wrote his partners that Balwani told him "The ‘science’ behind Theranos is complete," & "no new science needed, no new invention needed," which made the firm want to invest more. He adds that Balwani was "concise" & "confident."

Dorothy Atkins@doratki
2h

Mendenhall said Balwani never told him that Theranos was using non-Theranos devices to run tests, and that info would have made him "dial down" his investment and raise a bunch of q's.

Dorothy Atkins@doratki
2h

Mendenhall asked Balwani for "high-level" financial info on Theranos, but Balwani didn't want to give him the data b/c he said "they prefer to keep the competition guessing as to how much money they have and what their current revenue, profit margins, revenue sources etc."

Dorothy Atkins@doratki
2h

During the call, Mendenhall says Sunny Balwani was "very articulate, very intelligent, very specific and felt like he had strong command over the details" and Balwani was "extremely credible" and "he knew everything" about the business.
 
Dorothy Atkins@doratki
2h

Throughout Mendenhall's examination, Sunny Balwani has mostly had his head down taking notes -- gotta wonder what they say! -- and he looks up at the witness periodically.

Dorothy Atkins@doratki
2h

Mendenhall says after his conversation w/ Balwani, he and his firm invested $1.3 million into Theranos in Jan 2014, and signed an NDA. He asked for more financial info on Theranos in light of the NDA, but Balwani never responded.

Dorothy Atkins@doratki
2h

In May 2014, Mendenhall asked Balwani for a 'high level' update on Theranos, but Balwani forwarded his email to Elizabeth Holmes and didn't respond.

Dorothy Atkins@doratki
2h

In December 2014, Mendenhall sent Balwani another email asking 4 q's, b/c "there were rumors" & the investors were concerned. The q's included whether Theranos tests at Walgreens required shipping samples and took 24-48 hrs. Balwani forwarded the email to Holmes & no one replied.

Dorothy Atkins@doratki
2h

Mendenhall's direct wrapped with him saying his firm lost all its money in Theranos. Stephen A. Cazares of @orrick
is up for Balwani on cross, and he starts by getting Mendenhall to acknowledge that he's an experienced investor.

Dorothy Atkins@doratki
2h

Balwani's counsel tries to get Mendenhall to concede that as a private co, it was not obligated to disclose its corporate details & financials to investors. Mendenhall says sometimes investment docs say the cos will provide annual or quarterly updates, but he didn't get anything.


Dorothy Atkins@doratki
2h

Balwani's counsel is trying to get Mendenhall to admit he knew Theranos' tech had to be "refined" but Mendenhall won't concede the point. "I had no knowledge if they needed to refine the technology for any reason," he says.

Dorothy Atkins@doratki
2h

Balwani's counsel is really driving home the fact that Mendenhall decided to invest into Theranos without first receiving financial statements from the startup. Also points out that he knew Walgreens invested $100M into Theranos.

Dorothy Atkins@doratki
2h

Balwani's atty finishes cross getting Mendenhall to acknowledge he doesn't know if Balwani received info he gave him from Holmes. On redirect, he says he didn't know the pair were dating, but that info could have impacted his investment decision.

Dorothy Atkins@doratki
2h

Mendenhall says executives should disclose to corporate boards and general counsel if they're dating and "to let us have full view, bc there's always potential conflicts when the two leaders of the firm are involved."

Dorothy Atkins@doratki
2h

Mendenhall says executives should disclose to corporate boards and general counsel if they're dating and "to let us have full view, bc there's always potential conflicts when the two leaders of the firm are involved."

Dorothy Atkins@doratki
1h

Prosecutor asks Mendehall if the amount of info he was given about Theranos was unusual for investing in a private company. Mendenhall agrees. "It was unusual - unusually nonexistent."

Dorothy Atkins@doratki
1h

Mendenhall says there were an incredible pedigree of "pretty smart people" who were investing in Theranos, and "I dropped my judgment a little bit," but he relied on Balwani's statements and wouldn't have invested w/o them. "These were very very specific and compelling details."
 
Dorothy Atkins@doratki
54m

Trial took a break, and the attorneys argued some more about playing for the jury Elizabeth Holmes' recorded call with investors. At the end of arguments, the judge said he won't admit the evidence unless the government brings it in.

Dorothy Atkins@doratki
52m

Balwani's counsel, Jeff Coopersmith, appears to want to argue the point more, saying "I’ve never seen in a fraud case –" But Judge Davila interrupts him, "You're going to talk about the order I just made?"

After a pause Coopersmith replies, "No your honor, I’ll hold my tongue."

Dorothy Atkins@doratki
49m

Hall Group's John Bryan Tolbert is up next. He testified in Holmes' trial, so dialing back live tweets. Happy Friday
270c.png
 
UndiscoveredTruth said:
Dorothy Atkins@doratki
2h

Throughout Mendenhall's examination, Sunny Balwani has mostly had his head down taking notes -- gotta wonder what they say! -- and he looks up at the witness periodically.

Dorothy Atkins@doratki
2h

Mendenhall says after his conversation w/ Balwani, he and his firm invested $1.3 million into Theranos in Jan 2014, and signed an NDA. He asked for more financial info on Theranos in light of the NDA, but Balwani never responded.

Dorothy Atkins@doratki
2h

In May 2014, Mendenhall asked Balwani for a 'high level' update on Theranos, but Balwani forwarded his email to Elizabeth Holmes and didn't respond.

Dorothy Atkins@doratki
2h

In December 2014, Mendenhall sent Balwani another email asking 4 q's, b/c "there were rumors" & the investors were concerned. The q's included whether Theranos tests at Walgreens required shipping samples and took 24-48 hrs. Balwani forwarded the email to Holmes & no one replied.

Dorothy Atkins@doratki
2h

Mendenhall's direct wrapped with him saying his firm lost all its money in Theranos. Stephen A. Cazares of @orrick
is up for Balwani on cross, and he starts by getting Mendenhall to acknowledge that he's an experienced investor.

Dorothy Atkins@doratki
2h

Balwani's counsel tries to get Mendenhall to concede that as a private co, it was not obligated to disclose its corporate details & financials to investors. Mendenhall says sometimes investment docs say the cos will provide annual or quarterly updates, but he didn't get anything.


Dorothy Atkins@doratki
2h

Balwani's counsel is trying to get Mendenhall to admit he knew Theranos' tech had to be "refined" but Mendenhall won't concede the point. "I had no knowledge if they needed to refine the technology for any reason," he says.

Dorothy Atkins@doratki
2h

Balwani's counsel is really driving home the fact that Mendenhall decided to invest into Theranos without first receiving financial statements from the startup. Also points out that he knew Walgreens invested $100M into Theranos.

Dorothy Atkins@doratki
2h

Balwani's atty finishes cross getting Mendenhall to acknowledge he doesn't know if Balwani received info he gave him from Holmes. On redirect, he says he didn't know the pair were dating, but that info could have impacted his investment decision.

Dorothy Atkins@doratki
2h

Mendenhall says executives should disclose to corporate boards and general counsel if they're dating and "to let us have full view, bc there's always potential conflicts when the two leaders of the firm are involved."

Dorothy Atkins@doratki
2h

Mendenhall says executives should disclose to corporate boards and general counsel if they're dating and "to let us have full view, bc there's always potential conflicts when the two leaders of the firm are involved."

Dorothy Atkins@doratki
1h

Prosecutor asks Mendehall if the amount of info he was given about Theranos was unusual for investing in a private company. Mendenhall agrees. "It was unusual - unusually nonexistent."

Dorothy Atkins@doratki
1h

Mendenhall says there were an incredible pedigree of "pretty smart people" who were investing in Theranos, and "I dropped my judgment a little bit," but he relied on Balwani's statements and wouldn't have invested w/o them. "These were very very specific and compelling details."
Click to expand...
BBM. I find that to be BS personally that a company isn't obligated to disclose anything to their investors. These people are giving them billions of dollars. And basically Balwani lied to this guy, especially about the devices that they were using, and about his relationship with Holmes.
 
Update on docket:

Tuesday, May 3 2022

08:30AM
5:18-cr-00258-EJD - USA v. Ramesh Balwani
Motion to Exclude

09:00AM
5:18-cr-00258-EJD-2 - USA v. Ramesh Sunny Balwani
Jury Trial

link: CALENDAR
 
Tuesday, May 3rd:
*Trial continues (Day 15) (@ 9am PT) & Motion to Exclude (@ 8:30am) - CA – *Ramesh “Sunny” Balwani (53/now 56) (CFO & President of Theranos) indicted & charged (6/14/18) & arraigned (6/15/18) with 9 counts of wire fraud & 2 counts of conspiracy to commit wire fraud. Another count of wire fraud was added in 2020, bringing the total number of felony charges to 12. Plead not guilty. No bond. Faces a maximum sentence of 20 years in prison & a fine of $2.75 million, plus restitution, & $250K for each individual count of wire fraud & conspiracy. Plead Not guilty.
Federal Court 5:18-cr-00258-EJD-2 / SEC 5:18-cv-01603 filed 3/14/18 pending; plead not guilty.
Defrauding investors out of $700 million in funding for their blood-testing startup Theranos.
Trial began on 3/22/22. Jury: 12 jurors (6 women & 6 men) & 6 alternates (2 women & 4 men). 3/21/22: Jury #1 sick, alternate moves to jury. 12 jurors (6 women & 6 men) & 5 alternates (2 women & 3 men). Trial Court will be in session on Tuesdays, Wednesdays & Fridays (from 9-3), but the jury may be asked to come in on some Mondays & Thursdays as well. Trial dates so far: 5/3, 5/4, 5/10, 5/11, 5/13, 5/17, 5/18, 5/20, 5/27, 6/7, 6/8 & 6/10/22.
Indictment & court info from 4/11/20 thru 3/8/22 & Jury selection (Day 1-4) 3/9/22 to 3/15/22 & 3/16 to 3/21/22 & Trial Days 1-2 (3/22 to 3/23/22) & hearing on 3/29/22 & 4/12/22 & Trial Days 3-13 (3/30 to 4/27/22) reference post #141 here:
CA - Ramesh “Sunny” Balwani, 56, (Theranos), wire fraud charges
4/29/22 Friday, Day 14: Motion to exclude hearing: The attorneys argued over admitting exhibits - including a 2013 recording of Holmes' call with investors. Unexpectedly, the government doesn't want to play it, but the defense does. The judge didn't rule on the issue, and told the defense to give their request some more thought. He told the defense repeatedly that if they are going to argue Holmes' statements on the call are true, "there’s some caution with that."
Government witnesses: Patrick Mendenhall, the CEO of investment firm U.S. Capital Advisors LLC. He invested in Theranos in 2005 & 2013 & Sunny Balwani was his primary contact.
for more info see posts #143 & 144 here:
CA - Ramesh “Sunny” Balwani, 56, (Theranos), wire fraud charges
The attorneys argued some more about playing for the jury Holmes' recorded call with investors. At the end of arguments, the judge said he won't admit the evidence unless the government brings it in.
Government witness: Hall Group's John Bryan Tolbert.
for more info see post #145 here:
CA - Ramesh “Sunny” Balwani, 56, (Theranos), wire fraud charges
Trial continues on Tuesday, 5/3/22 @ 9am. Motion to exclude hearing @ 8:30am.
*Elizabeth A. Holmes (34/now 37) (CEO of Theranos) – Trial began on 9/8/21 & ended 1/3/22 with a verdict of guilty on 4 counts of 11. Next sentencing hearing on 9/26/22.
 
LinasK said:
BBM. I find that to be BS personally that a company isn't obligated to disclose anything to their investors.
Click to expand...

As a private company, it would only be obliged to provide what was contracted for.

Having got down in the weeds during the Holmes trial, there were some very strange aspects to all this.

For the very early phase investors, obviously you wouldn't expect there to be anything in the way of financials much - but then clearly they never updated those people in the future. Holmes and Balwani also withheld financial info from the more sophisticated later investors, because they had no audited accounts.

IMO, this is one way Holmes and Balwani tried to avoid doing an obvious fraud.
 
Looks like there "might" not have been anything happening yesterday - as the court site has this for yesterday.

Tuesday, May 3 2022

- GENERAL DUTY


Wednesday, May 4 2022

- GENERAL DUTY
09:00AM
5:18-cr-00258-EJD-2 - USA v. Ramesh Sunny Balwani
Jury Trial


and this was added:

Tuesday, Jun 14 2022
09:00AM
5:18-cr-00258-EJD-2 - USA v. Ramesh "Sunny" Balwani
Jury Trial

link: CALENDAR
 
Wednesday, May 4th:
*Trial continues (Day 15) (@ 9am PT) - CA – *Ramesh “Sunny” Balwani (53/now 56) (CFO & President of Theranos) indicted & charged (6/14/18) & arraigned (6/15/18) with 9 counts of wire fraud & 2 counts of conspiracy to commit wire fraud. Another count of wire fraud was added in 2020, bringing the total number of felony charges to 12. Plead not guilty. No bond. Faces a maximum sentence of 20 years in prison & a fine of $2.75 million, plus restitution, & $250K for each individual count of wire fraud & conspiracy. Plead Not guilty.
SEC 5:18-cv-01603 filed 3/14/18 pending; plead not guilty.
Defrauding investors out of $700 million in funding for their blood-testing startup Theranos.
Trial began on 3/22/22. Jury: 12 jurors (6 women & 6 men) & 6 alternates (2 women & 4 men). 3/21/22: Jury #1 sick, alternate moves to jury. 12 jurors (6 women & 6 men) & 5 alternates (2 women & 3 men). Trial Court will be in session on Tuesdays, Wednesdays & Fridays (from 9-3), but the jury may be asked to come in on some Mondays & Thursdays as well. Trial dates so far: 5/4, 5/10, 5/11, 5/13, 5/17, 5/18, 5/20, 5/27, 6/7, 6/8, 6/10 & 6/14/22.
Indictment & court info from 4/11/20 thru 3/8/22 & Jury selection (Day 1-4) 3/9/22 to 3/15/22 & 3/16 to 3/21/22 & Trial Days 1-2 (3/22 to 3/23/22) & hearing on 3/29/22 & 4/12/22 & Trial Days 3-13 (3/30 to 4/27/22) reference post #149 here:
CA - Ramesh “Sunny” Balwani, 56, (Theranos), wire fraud charges
5/3/22 Tuesday: No hearing or court today. Trial continues on Wednesday, 5/4/22 @ 9am.
*Elizabeth A. Holmes (34/now 37) (CEO of Theranos) – Trial began on 9/8/21 & ended 1/3/22 with a verdict of guilty on 4 counts of 11. Next sentencing hearing on 9/26/22.
 
Docket update:

Tuesday, May 10 2022
09:00AM
5:18-cr-00258-EJD-2 - USA v. Ramesh Sunny Balwani
Jury Trial

Wednesday, May 11 2022
08:30AM
5:18-cr-00258-EJD - USA v. Ramesh Balwani
Motion to Compel

09:00AM
5:18-cr-00258-EJD-2 - USA v. Ramesh Sunny Balwani
Jury Trial


link: CALENDAR
 
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