S2: part of it. Confirmed 100 Greg." "-Likely refering to Journal reporter @JohnCarreyrou. She was young, rich, charismatic and seemingly everywhere. To answer your questions, yes, a lot of the #Theranos text messages are (somewhat) romantic, but often with an undercurrent of paranoia:Elizabeth Holmes: "Was thinking about you this morning. What role you think gender plays in all of this and how that might play out in the courtroom? When Elizabeth Holmes was nine, she wrote a letter to her father saying she wanted to discover something new that mankind didnt know was possible. Is it the inability or the refusal to accept responsibility or express contrition in any way? Such messages could undercut a defense Ms. Holmes's lawyers said they may raise, alleging the pair were in an abusive relationship that left her under Mr. Balwani's control during the time of the alleged fraud conspiracy. And I feel like in that way, maybe this this timing maybe is not great for her. It doesnt live up to what it would take for me to even consider covering it as a solution. Prosecutors said the texts support their argument that Balwanis statements to federal regulators about his responsibilities at Theranos are untrustworthybecause they may been colored by his affection for Holmes. Elizabeth Holmes Trial: A whistleblower and ex-Theranos employee, Erika Cheung, will be a key witness. Sign up for free newsletters and get more CNBC delivered to your inbox. We dont know a lot about this approach yet, but court documents hint at it. I can confidently say that Ive never told someone that theyre the breeze in the desert, but my text history is still embarrassing as hell. Was it hubris? "There was no way I could save our company if he was there," Holmes said Tuesday. I saw it. From the stand, Holmes acknowledged that the company's actions targeting Cheung and Shultz were a mistake. "They don't show abuse or any kind of difficulty between the two of them," said Michele Hagan, a legal analyst and former prosecutor, of previously released texts between Holmes and Balwani. (Cheung would later testify that the number was even lower: around 12.) And it's clear from her comments that that spirit, her desire to produce, to make her company successful, perhaps, is what caused her to, as she told us just a moment ago, make certain mistakes. That's the foundation of innovation and investment, honesty in the market. She had creative ideas. Some of the Theranos investors are expected to testify in the trial. The scheme brought her fame, it brought her honor and it brought her adoration, Leach added. When the company started to be exposed, Elizabeth Holmes seemed seemed to double down. "My water." "And ocean." "Meant to be only together tiger.". Trying your hardest and coming up short is not a crime, defense attorney Lance Wade told the jury. Its not for any noble reason I dont have any new sense of morality or sudden desire to be a very good person. She wore Steve Jobs, inspired black turtlenecks, was photographed holding a miniscule vial of blood, and the companys marketing slogan was One tiny drop changes everything. They heard, saw the texts, the chain, the messages, the collaboration, if you will, between the co-defendants, and they saw that. In a 2014 text message, Holmes wrote to Balwani: "total confidence in myself best business person of the year. U.S. District Judge for the Northern District of California Edward Davila sentenced former Theranos CEO Elizabeth Holmes to 11 years in prison last week following a four-month trial in which a jury found Holmes guilty of defrauding investors at her blood-testing company. S2: be right. S2: It was one of those things where, huh, this just it it doesnt fully line up. Youre listening to what next TBD Im Lizzie OLeary, and Im talking with ABC News business correspondent Rebecca Jarvis. Theranos Inc. founder Elizabeth Holmes's sometimes banal, sometimes cringeworthy text messages with former president Ramesh "Sunny" Balwani have been released as an exhibit in her criminal. Since then, Holmes has settled separate civil fraud charges with the Securities and Exchange Commission without admitting guilt. Can you, I guess, describe some of the myths that she tried to make about herself? The text messages paint a picture of life for the former couple. I don't think that they would, they would condone fraud. Filings unsealed last week and Holmes attorneys opening statement suggest she will try to defend her innocence by pinning the blame for the multi-billion dollar scam all on Balwani. S1: When we come back, the Elizabeth Holmes of 2021 isnt the same person she was just three years ago. A subreddit dedicated to conversation about Theranos, the healthcare company founded by Elizabeth Holmes in 2003. Weve all been there (we have, right? S5: Whenever there is a quote unquote glass ceiling, theres an iron woman right behind it. Balwani said. S2: Well, I think, look, every any PR person that youre going to talk to you is going to tell you to stay on message. Eventually, the #Theranos text messages turn decidedly non-romantic.Balwani: "lab is a f-ing disaster zone. S1: She checked it out, but couldnt get anyone to independently verify that these Theranos blood tests, which only used a finger prick and not a traditional vein stick, were actually going to be better and cheaper. The government opened its cross-examination of Holmes by zeroing in on the months before journalist John Carreyrou, then with The Wall Street Journal, began investigating Theranos for a series of stories that helped spark the regulatory scrutiny that put the company's demise into motion. This material may not be published, broadcast, rewritten, or redistributed. TBD is part of a larger what next family. Holmes' direct examination by her lawyer concluded on Monday . I got an inaccurate test versus having a database to back up and say statistically, heres a large percentage of people who got inaccurate tests. One person who has a plan and executes can defeat an army. There have been settlements along the way where investors have been paid some degree back of their original investments because they claimed that they made the investment under false pretenses. Spivey testified that Theranos was hemorrhaging money at a time when Holmes was portraying herself as a successful CEO to investors. S2: I think a lot of people in Silicon Valley are watching this case. There are 11 patients whose experiences youll be hearing about in the courtroom. Prosecutors just released text messages . Shes an outlier. They really do rely on it. Fraud is genderless. No, I am zealously sticking to the law because doing crimes could, theoretically, put me in the same position disgraced Theranos founder Holmes is in right now: having my text message history revealed in court. S2: Hey, theres this blood testing company, Theranos, and they can save your viewers a lot of money. And she created this and immersed herself forward.People gravitated towards her idea. @kron4news (Getty Images photo) pic.twitter.com/ZUqeTjU4gd. And Mr. Downey suggests she did not go to that, it came to her. Elizabeth Holmes's reputation is disgraced, and her career is essentially over. Holmes and Balwani have both pleaded not guilty. Thousands were released by the. Do you think that the Silicon Valley has learned anything about kind of what role investors and sort of professional board member class plays in in things like this? The story of Elizabeth Holmes and Theranos is an unbelievable tale of ambition and fame gone terribly wrong. Her company struck a deal with Walgreens to put Theranos blood testing centers in thousands of drugstores. Holmescould be sent to jail for 20 years if shes found guilty. Plan, focus, stay organized and stay in control. S1: I think about where society is right now in the middle of a pandemic in this particularly intractable feeling phase. "I completely agree with that plan," Holmes sent back, along with a happy face. Which is why it's hard to breath without your breath near me," Balwani responded. She had recovered. We know what she created. There is no love for me like yours. Stick with us. "Very good :)" Holmes said, adding "He would have met longer.". Its about the survivors of R. Kellys abuse and getting justice for them. This precocity was a key part of her public image. Her attorneys previously indicated they may accuse Balwani of intimate partner abuse, arguing that Holmes wasn't making her own decisions at the time the government alleges she acted to defraud investors, doctors, and patients. There was significant evidence about manipulation and untruths that were being used in the negotiation of the business. Prosecutors said when Holmes was faced with failure and her company was in danger of going broke, she chose to lie and deceive investors to keep her company from falling apart. On the 2015 interview, Holmes said told Cramer: "Every test that we offer in our lab can be run on our proprietary devices.". On Tuesday, as a rapt courtroom watched on, a clip of that interview was played for the jury. Legal experts say Spivey is establishing a motive. What next? And she did that. The jury must find beyond a reasonable doubt that Holmes intentionally bamboozled investors and misled patients in order to convict her. Balwani wrote to Holmes, I am narrowing this down in CLIA. And that's the issue of funding for business that we see. S4: At 19 years old, Elizabeth Holmes dropped out of Stanford. Spivey was Theranos financial manager. Maya Angelou," Holmes said in an April 2016 text. Holmes' trial began last month. Thousands were released by the prosecution and more were obtained by CNBC. She got into that world. And Ocean, the texts continued. S1: said, no, I dont know. Theranos Inc.founder Elizabeth Holmess sometimes banal, sometimes cringeworthy text messages with former president Ramesh Sunny Balwani have been released as an exhibit in her criminal fraud trial. All contents For 11 weeks, the only words from Elizabeth Holmes in her criminal trial came from old TV interviews, an audio recording of an investor call and text messages presented to the jury. "My new life as of this night and forever more: - total confidence in myself best business person of the year focus details excellence don't give what anyone thinks engage employees in meetings by stories and making it about them (ie prepare well)," Holmes texted Balwani in November 2014 while discussing the full moon that evening. Millions of people got these tests. I mean, I wonder. The court imposes this sentence after consulting the United States sentencing guidelines and in light of the statutory concerns expressed in 18 United States code section 3553(a). The richness of the earth that is below us here in this valley at one time was agriculture. Over the same period of days, the two discuss who they think spoke to The Wall Street Journal, which hadn't yet published its first story on Theranos, and how they could retaliate. It might seem like a slam dunk case for the . She is its mostly taking the fifth. Everybody knows Steve Jobs always wore the black turtleneck. So there is I think theres a reverse engineering there that might have gone on for her, that its like the most basic things that a person could copy that suddenly in her mind made her the equivalent of a Steve Jobs and also in the mind of the press. S1: The US in 2018, the United States filed criminal charges against her and her former CEO and boyfriend, Sunny, about warning next week. Searching for the word murder in iMessage brings up dozens of results, most of which are in conversations about online dating. Keep focused and keep fighting. "That's a huge red flag. This idea of affinity investing, it still exists saying, oh, I know that guy or girl. You can find all of the newly released texts here. Murdoch invested $125 million in the company. Budget & Performance; Careers; Commission Votes; Contact; Contracts; Data Resources . Revealing these text messages was part of the prosecution's efforts to show that Holmes knew what was going on at Theranos even as things were falling apart. Update October 4th, 3:53PM ET: Updated to add additional texts. Down to 5 people. Many of Holmess lies are documented, but Rebecca says that doesnt mean its a guaranteed victory. The text messages obtained by CNBC show discussions about Carreyrou between Balwani and Holmes. ", About 12,000 text messages sent between Holmes and former Theranos Executive Sunny Balwani were extracted from phones and computers, including one where Balwani referred to a Theranos lab, with an expletive, as a "disaster zone.". But as all things do, times change. In this regard, the court will impose the following: the court will impose a special assessment of $400, that's $100 for each count. A series of messages from April 2015 show the pair took a luxurious weekend trip to Las Vegas. We know this local history. This idea of her lifestyle, which, again, is something her attorneys fought very hard to keep out of the courtroom. The startup was once celebrated as a biotech breakthrough and made Holmes one of the world's youngest female billionaires before the company disintegrated in scandal. Holmes is currently on trial and accused of defrauding Theranos Inc investors of hundreds of millions of dollars. elizabeth-holmes-transcript-2017.pdf (88.43 MB) STAY CONNECTED 1 Twitter 2 Facebook 3 RSS 4 YouTube 6 LinkedIn 8 Email Updates. I am going to be very, very good. Former Theranos founder and CEO Elizabeth Holmes leaves the Robert F. Peckham Federal Building with her partner Billy Evans. What caused that? Also on the stand on Wednesday was retired four-star general and former Theranos board member James Mattis. I am a Dropout of Stanford, one of the best universities in the country. NBC Bay Areas Raj Mathai speaks with Business and Tech Reporter Scott Budman and Criminal Defense Attorney Paula Canny about the latest in the Theranos trial -- text message revelations. "I love this," Holmes responded. The court will ask that the parties meet and confer regarding a restitution hearing date that we will set in the future. And I want to recommend you take a moment and go back and listen to Tuesdays episode of What Next. She had become, as she sought, one of the most celebrated CEOs in Silicon Valley and the world, Leach said. "Infinite love for you in every breath," Balwani told Holmes later that month. Copyright 2023 Nexstar Media Inc. All rights reserved. Sign up for NBC Bay Areas Housing Deconstructed newsletter. . If you want a pest-free patio this spring, the most important thing you can do is take away those elements that bugs find desirable. Scott Budman reports from San Jose. Cracking a smile at the question, Holmes replied: "No.". Elizabeth Holmes was CEO of Theranos. "Would it surprise you to know that the word 'love' appears in the texts 594 times?" ", "Then let's focus on it in our room, do dinner, and go back early," Holmes replied. And Mr. Downey tells us this was not a pursuit of money. CNBC has obtained nearly 600 pages of private text and Skype messages between former Theranos CEO Elizabeth Holmes and her then-boyfriend Sunny Balwani. S2: and we featured a woman who was spending a lot of money on blood tests. The test validation report originally said it was prepared for a doctor, but that was deleted before it was shared with Walgreens. Stanford Dropout. Meeker is a well-known venture capitalist who is a partner at Bond Capital. In some of the more uncomfortable moments of the day's testimony, Assistant U.S. Attorney Robert Leach made Holmes read cloying text messages with Balwani where she called him "my tiger" and Balwani wrote "I worship you.". After all, this is Elizabeth Holmes were talking about. The message to her then-boyfriend and Theranos President Balwani are among thousands of private texts and Skype messages obtained by CNBC that show Holmes had no lack of confidence in herself and Theranos, the blood-testing company she founded. S5: You know, its its not what matters. "You live in my eyes. One thing that the letters omit, though, they did not say, they did not say anything about, nor did they endorse, failure by fraud. I was thinking today. The question is now, how is the jury going to respond to the evidence of individuals coming forward and saying, heres my story. S2: If Elizabeth was able to convince, as she did investors, former secretaries of state, entire groups of people, auditoriums filled with people, if she was able to convince so many of her vision already, why is it improbable that she would be able to convince 12 jurors. "Sunny Balwani: "We need to stay focused and vigilant. A criminal fraud trial for Silicon Valleys former golden girl is underway. Theranos founder and CEO, billionaire superstar and media darling. Transcript Enlarge this image Former Theranos founder and CEO Elizabeth Holmes leaves the Robert F. Peckham Federal Building with her partner Billy Evans. Those letter writers did not condone misrepresentations, manipulation. How do we keep that going? We know, the record shows, that the misrepresentation, there were many. By clicking Sign Up, you also agree to marketing emails from both Insider and Morning Brew; and you accept Insiders. S2: at a very young age, decided that she wanted to change the world. They heard the statements that were made to them. Slate is published by The Slate Three years after she was first indicted, Holmes goes on trial for conspiracy and fraud. And if she doesnt, then its just like game on for whatever you want to do. Last Updated: .css-9d8khp-TimeTag{display:inline-block;}Feb. 25, 2022 at 7:41 PM EST, Former Theranos President Ramesh Balwani in 2019. "People would just disappear and they were leaving without jobs, it was clear the company was grounded to a halt," the former Theranos employee said. And that's the troubling part of this. I got to comb through and pick only a few messages that I thought would help communicate that I am someone who sends somewhat embarrassing texts but am not TOO weird. Holmes just had everything dumped on the internet for anyone to see. Now she could face up to 20 years in federal prison. And I guess why you think she did that, you know, wearing a black turtleneck like Steve Jobs, like why do all that stuff? Cheung and Tyler are anticipated to testify against their former boss for Holmes trial. Theranos gave the government what they say is access to this database. It's not folklore. Bad timing. They dont think this makes or breaks the case. What did Elizabeth Holmes and Ramesh "Sunny" Balwani say to each other when they thought no one else was listening? So investors, sophisticated investors, it's all right to invest and lose money, that's the expectation, but the public and sophisticated investors that make those investments, they take those risks. She dropped out of Stanford at 19 and started Theranos with a promise that her machines could shake up an industry that hadnt changed in decades. And she will also have three individuals in the courtroom with her family and or friends who will be at her side. Whatever you decide and whatever happens is in gods hands. Balwani, who also faces federal fraud charges, will be tried separately. Who made a decision to drop out of school, left school with a minimal amount of education and minimal amount of background. hide caption. The court will adopt the recommendations of supervised release as indicated in the PSR. Shes scared of needles. Leach pointed out how Holmes did not mention the use of commercial blood-testing machines in response, asking if Holmes now regrets that. Balwani: Missing u in every breath and in every cell. Justin Sullivan/Getty Images (Balwani). His board salary would've been $150,000 a year. U.S. District Judge Edward J. Davila, left, sits with U.S. Supreme Court Associate Justice Anthony M. Kennedy at a panel discussion in 2018. "I agree. Balwani is effusive, often offering encouragement, advice and prayers to Holmes. But theres still so much that feels relevant for more relatable reasons. 2023 Disgraced Theranos founder Elizabeth Holmes said she had "total confidence in myself best businessperson of the year" in text messages to her former boyfriend and business partner Ramesh . I was born up the street, and I remember this valley, and the innovation of this valley. Concurrent with that is with those businesses are how do we fund that? Now, Ive talked to a number of legal experts who believe that that type of defense, a mental disease or defect, can really backfire with a jury. Alex Gallardo/AP They could be very useful because youd love to see if millions of tests were inaccurate, if a huge percentage of the tests based on these results were inaccurate. How do we create that? About The SEC. Murdoch declined. That young women entrepreneurs are regrettably denied access to, but she made that. / Sign up for Verge Deals to get deals on products we've tested sent to your inbox daily. The letters that were referenced, I've read them, they were meaningful. They heard the evidence. And they were moving. S2: I would love to say yes. She uses ditto nine times in the texts that are part of the exhibit. Many of the letter writers weren't at the trial I don't believe, but they spoke to a different individual and their experiences. In one exchange, he even suggests Holmes meet one-on-one with self-help author and motivational speaker Tony Robbins: He doesnt do this but we can ask.. This case is so troubling on so many, so many levels. Al Jazeera Centre for Public Liberties & Human Rights. 2023 CNBC LLC. So we will do it. In March 2015, Holmes texted Balwani: "Mary Meeker trying to convince me to stay private, raise massive $$$ and go and think bigger.". S1: someone must have known that that these results were inaccurate if there were so many of them. "And so, that was it.". It might seem like a slam dunk case for the prosecution. Leach said. alleging the pair were in an abusive relationship. But what the government has to prove now in the criminal case is that Holmes wasnt just a true believer with bad luck, but someone who intended to deceive investors and patients. They have many emails . So we will do it. Now, perhaps that is the cautionary tale that will go forward from this case. S2: Ive thought a lot about that, too, and I agree with that. Yichuan Cao/NurPhoto via Getty Images (Holmes). Holmes is currently on trial and accused of defrauding Theranos Inc investors of hundreds of millions of dollars. Holmes and Balwani were working together, and worrying together, about their machines including one dubbed "Edison. Trial hinges on how she is painted in courtroom, Elizabeth Holmes trial to dissect downfall of a tech star, Where is Elizabeth Holmes? We could never access the data. Beyond the love notes, there are also texts about seeking to silence medical professionals and Theranos employees who were raising red flags because Theranos mini blood testing devices were giving false test results. My water. All Rights Reserved. They weren't here. They could have looked at it, but and then we learned that there was tape perhaps, there were secured machines, the Edisons were secured. S2: OK, so theres this database that includes results of Theranos tests, millions of them over the course of a handful of years. They shed light on their past relationship and efforts to keep Theranos afloat amid scrutiny. In their opening statement, Holmes defense team painted her as an innocent businesswoman whose company failed, and they reminded the jury that she did not run Theranos alone. Holmes replied. Leach asked of the trove of messages prosecutors subpoenaed as part of the investigation. Dozens of text messages between Holmes and her ex-boyfriend (and ex-business partner) Sunny Balwani were read aloud during Holmes trial for fraud this week. Holmes was then shown an email from former Wells Fargo CEO Richard Kovacevich, who was an investor and board member of Theranos, asking about exactly how many tests are being performed on the company's Edison compared to conventional lab equipment. 0:00/33:09-33:09. . In this matter, the court is going to impose a sentence that the court finds is sufficient but not greater than necessary, to comply with the purposes set forth in 18 United States code section 3553. S2: Look, its hard to fully be inside of her head, but I do think that we are so frequently taught the myth of Steve Jobs. indicated they may accuse Balwani of intimate partner abuse. S1: Rebecca Jarvis spent years covering homes and made an investigative podcast about her called The Dropout. In another exchange, Balwani said "Got table at XS dance [floor]." We know what she has done. The two also seemed to share a pet. The text messages were released by prosecutors in her trial Tuesday. She faces up to 20 years in prison and has pleaded not guilty. Those are concurrent, concurrent as to each count. Theranos imploded after investigative stories bythe Wall Street Journal were published in 2015. I was I was pretty captivated by it. Holmes appeared expressionless from the witness stand. Holmes, 38, has been ordered to turn herself in April, 27, 2023, and she is expected to serve her sentence at a minimum-security women's facility about 100 miles outside of Houston, where Holmes grew up. This is a fraud case where an exciting venture went forward with great expectations and hope only to be dashed by untruth, misrepresentations, hubris, and plain lies. So I was weeded out of many students. Was it removed by Holmes, Leach asked? Nov. 24, 2021 Downloads. "For a lack of a more legal term, they want to show the two were in kahoots," said Esquire Digital Legal Analyst Aron Solomon. They could have tested it. This area no longer produced the strawberries, the apricots, the cherries, the artichokes, and the tomatoes that it once did in that great abundance, but rather the technology changed, didn't it? S1: Gender is so complicated in this story, and and on the one hand, the path for a female founder is unquestionably harder than it is for a man on the other. Hang myself I assume, she responded, in another dubious (and to be clear, exaggerated) entry into both of our iMessage histories. The court has reviewed those and finds that they are appropriate, and the court will order those. Ranchers, farmers came to this valley from Europe, from Asia. The texts also show specifics about the high-flying lifestyle Holmes and Balwani led while Theranos was bleeding hundreds of millions of dollars, according to financial reports. "Your presence on earth is proof of God's presence. The industry that we know of here regrettably finds vectors with the financial and personal gain that clouds sometimes the good judgment of individuals, and we see that. That's what provided and drove this area's economy. They didn't talk about that, and I don't think that they could. So the defense will argue this is all anecdotal. I'm a native. So failure is not uncommon, and you should recognize that, they suggest. These letters speak to a recognition that companies fail, they falter. The text messages paint a picture of life for the former couple. But I would also say, look, Im sure that someone in the venture community who hears this conversation will come back to us and say, oh, press, you love to celebrate individuals in this community. Theranos founder Elizabeth Holmes was once the world's youngest self-made female billionaire. She will have time to be with her newborn son. And then I feel like the title, the Dropout was like a sort of nod wink at the self mythologising that Elizabeth Holmes put put forward. S1: Im really struck by the fact that all of these board members and investors, many of them never had to pay the piper or own up for for their part in promoting Elizabeth Holmes and her lies. Balwani oversaw Theranos lab, which thegovernment says provided false and misleading results of blood tests that endangered some peoples lives and inflicted harm on many, Wade noted in his remarks. But what was it then? Balwani responded by simply writing, "OK.". "The way we handled the Wall Street Journal process was a disastrous," Holmes testified. On cross examination by prosecutors on Tuesday, Holmes recollection became murkier.

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