Elizabeth Holmes criminal trial dominated by allegations of deception and intimidation from those who worked for her

·3 min read
Elizabeth Holmes criminal trial dominated by allegations of deception and intimidation from those who worked for her

Just three weeks into the criminal trial of Elizabeth Holmes, jurors have already heard allegations of lies, deception and alleged intimidation from those who worked directly under her -- and the trial is expected to continue into December.

"I was scared that things would not go well," one former Theranos scientist, Surekha Gangakhedkar, told prosecutors when asked why she made copies of internal communications and documents before resigning from the company. "I was also worried that I would be blamed."

A full recap of last week's proceedings is available on today's episode of "The Dropout: Elizabeth Holmes on Trial" free on Apple Podcasts, Spotify, Amazon Music, or wherever you listen to podcasts.

Theranos was founded by Holmes in 2003. The company claimed to be developing blood testing technology that used only small droplets of blood.

Nearly two decades later, Holmes is defending herself against charges of wire fraud and conspiracy to commit wire fraud stemming from a "multi-million-dollar scheme to defraud investors, and a separate scheme to defraud doctors and patients," according to prosecutors.

Gangakhedkar and Erika Cheung, two former Theranos scientists, testified under oath last week. They both conveyed the same information to the jury: Theranos' Edison devices -- their blood testing machines -- rarely functioned properly.

MORE: Podcast: 'The Dropout: Elizabeth Holmes on Trial'

Cheung told the court that Theranos would frequently cherry-pick data, deleting "any two data points that would not hit the metrics we needed." She added that in March of 2014, about one in every four Theranos tests failed.

Cheung was one of the whistleblowers who first leaked information about Theranos to the Wall Street Journal in 2015. ABC News interviewed Cheung in the first season of "The Dropout."

"Our quality controls were failing at one point ... what seemed [like] almost every day," Cheung told ABC News in 2019.

PHOTO: (FILES) In this file photo taken on Sept. 8, 2021 Elizabeth Holmes, founder and former CEO of Theranos, leaves the courthouse with her husband, Billy Evans after the first day of her fraud trial in San Jose, California. (Nick Otto/AFP via Getty Images)
PHOTO: (FILES) In this file photo taken on Sept. 8, 2021 Elizabeth Holmes, founder and former CEO of Theranos, leaves the courthouse with her husband, Billy Evans after the first day of her fraud trial in San Jose, California. (Nick Otto/AFP via Getty Images)

Gangakhedkar was the former manager of assay systems at Theranos and reported directly to Holmes. She told the jury that she didn't think Theranos' devices "were ready to be used for patient samples."

Prosecutors presented several emails from 2013, in which Gangakhedkar reported the results of numerous failed tests on the Edison devices to Holmes directly. At the time, Theranos testing centers had already gone live in some Walgreens stores.

When prosecutors asked Gangakhedkar where this pressure to move forward before Theranos was ready came from, she swiftly responded "from Ms. Holmes." Holmes' defense has only just begun to question Gangakhedkar and will continue Tuesday.

The court granted Gangakhedkar full criminal immunity before she took the witness stand. She told the court she took documents with her upon her departure from the company, despite her non-disclosure agreement, "to protect myself and to have as a record in the event issues came up in the future."

MORE: Elizabeth Holmes drawn as villain, underdog as trial begins

At the time Cheung was speaking with an investigative reporter in 2015, she believed she was being followed by people hired by Theranos. Soon after she started another job, she told jurors she was served a letter by an unknown individual at an address not many in her circle were aware of.

The jury was shown the letter, addressed from the firm Boies Schiller Flexner, and claimed she had disclosed Theranos' "trade secrets and other confidential information without authorization."

Recent Theranos financial documents made public via Holmes' trial show the company paid $150,000 to private investigators for a project titled "E. Cheung & T. Schultz project." Tyler Schultz was another Theranos whistleblower speaking with an investigative journalist at the time.

A source with knowledge of the transaction told ABC News the firm Boies Schiller Flexner facilitated the hiring of those investigators. The firm declined to comment on the matter.

This week, Gangakhedkar will conclude her testimony.​​ Dan Edlin was once Theranos' senior project manager and one of many friends recruited to the company by Holmes' brother, Christian.

Holmes and her counsel did not respond to ABC News' repeated requests for comment.

Elizabeth Holmes criminal trial dominated by allegations of deception and intimidation from those who worked for her originally appeared on abcnews.go.com

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