Sunny Balwani, former Theranos executive, was found guilty of fraud
In connection with his work at the now-defunct blood testing start-up founded by his former girlfriend and business partner Elizabeth Holmes, Ramesh "Sunny" Balwani, the former president of Theranos, was found guilty of fraud.
After several days of deliberation, the jury in San Jose, California, announced its decision on Thursday.
In relation to what prosecutors claimed was a complex scheme to conceal from investors, business partners, and clients the fact that the company's blood-testing technology was flawed, Balwani was found guilty on all 12 counts of fraud and conspiracy. Actually, its tests were secretly carried out on tools that were readily available in commerce.
Prosecutors allege that Balwani, 57, promoted Theranos' claim that it would revolutionize healthcare by performing a variety of tests with only a few drops of blood when he was named chief operating officer of the company in 2010.
He was tried independently of Holmes, who this year was found guilty on four counts of investor fraud and found not guilty on four additional counts involving patient fraud. Three additional investor-related counts were not decided by the jury.
He and Holmes could spend up to 20 years behind bars. Balwani's sentencing has been scheduled for November, while Holmes' sentencing will take place in September.
Following reporting by journalist John Carreyrou, whose account of its rise and fall has been dissected in numerous podcasts and dramatized in television shows, the criminal prosecutions have put a cap on Theranos' dramatic collapse.
Nearly $1 billion in funding for Theranos came from investors including Rupert Murdoch and Larry Ellison. Its failure and what a string of prominent backers revealed to be a lack of thorough due diligence sparked a discussion on Silicon Valley's "fake-it-until-you-make-it" culture.
The defense painted Balwani as Holmes's sexual and emotional abuser during the Holmes trial, which took place in front of throngs of international media but which he has vehemently denied.
Defense attorneys in Balwani's trial, which received less media attention, were unable to sufficiently separate him from Holmes' actions. Balwani is alleged to have written in 2015 in text messages between the two: "I am responsible for everything at Theranos."
Prosecutors claimed that Balwani, who had pleaded not guilty, had been directly involved in attempts to trick investors into thinking that pharmaceutical company Pfizer was collaborating with the business. Prosecutors claimed that he also exaggerated revenue estimates that were later used to entice investment.
By fLEXI tEAM