When Elizabeth Holmes, the founder of failed blood testing startup Theranos, was convicted of fraud in January, the verdict marked the end of a never-ending saga.

But in the months that followed, as Ms Holmes awaited sentencing, the drama surrounding her case only intensified.

Ms Holmes’ first co-conspirator, the former chief operating officer of Theranos, was convicted of fraud in July. Then Ms Holmes asked the judge to overturn her conviction, citing a lack of evidence, and submitted a flurry of demands for a new trial based on fresh evidence. During recent hearings into the case, she appeared visibly pregnant with her second child. And in August, a key witness did something very unusual in a criminal case: He showed up at her house.

This incident became the basis of Mrs. Holmes’ latest attempt to reverse her fortunes. On Monday, the 38-year-old woman, her parents and partner, attorneys and a scrum of media gathered in a federal courtroom in San Jose, Calif., for a hearing that could open the door for her to a new court case. According to lawyers for Ms Holmes, the visit of the key witness raised questions about her credibility and the fairness of the trial.

The move is a long shot, experts said.

“It’s a virtual certainty that the judge will deny Elizabeth Holmes a new trial” based on the witness’s visit to her home, said Amanda Kramer, a former federal prosecutor associated with law firm Covington & Burling. The judge most likely allowed the hearing to prevent Ms Holmes from using the incident in her inevitable appeal, Ms Kramer added.

 

But the case of Ms. Holmes, who has come to symbolize the pitfalls of Silicon Valley’s hip start-up culture, has not been typical. Ms Holmes and her partner, Billy Evans, declined to comment on the matter or whether they were waiting.

At issue is a visit on Aug. 8 from Dr. Adam Rosendorff, who played a key role in Theranos’ rise as lab director. Later, he became a whistleblower who helped expose the company’s fraud. Theranos had told patients and investors that its breakthrough technology could accurately perform thousands of blood tests with a single drop of blood when it could not.

During Ms Holmes’ trial last year, in which she faced nearly a dozen charges of deceiving patients and investors, Dr Rosendorff endured six murderous days of testimony, the most along with all the witnesses. Later, jurors said they found his testimony among the most credible in the trial.

Then, in August, Dr. Rosendorff visited Theranos’ former office in Palo Alto, Calif., as well as the first Walgreens store the company had worked with. Both, he found, were gone.

As a result, he “suddenly felt that a conversation with the defendant was the missing piece” to moving on with his life, his lawyers said in a filing. Dr. Rosendorff drove to Ms. Holmes’ residence in Woodside, California. Mr. Evans answered and told him to leave.

From there, the accounts differ. Ms Holmes’ camp said Dr Rosendorff expressed guilt for his role in the situation and said government prosecutors “made things worse than they were”. Ms Holmes argued the incident called into question Dr Rosendorff’s testimony and the entire government case, meaning she deserved a new trial.

On Monday, Dr. Rosendorff returned to the stand. Judge Edward Davila, who oversaw Ms Holmes’ trial, questioned whether Dr Rosendorff’s testimony at the trial was truthful and whether the government had accurately represented the facts. He testified affirmatively.

Then Lance Wade, Mrs. Holmes’ solicitor, grilled him. Why did Dr. Rosendorff want to visit Mrs. Holmes? Had Dr. Rosendorff had a nervous breakdown that impacted his testimony? Was the government trying to make everyone look bad? Was Dr. Rosendorff trying to help Mrs. Holmes?

Dr Rosendorff responded by accusing Ms Holmes’ lawyers of trying to present him as a liar. He said he felt sympathy for Theranos employees who were affected by the scandal – but not for Ms Holmes and her co-conspirator, Ramesh Balwani. He added that he felt bad that Ms Holmes’ children would grow up without a mother if she went to prison.

Ms Holmes was found guilty of four counts of fraud, each carrying a maximum sentence of 20 years in prison.

Dr. Rosendorff testified that his contact with Ms. Holmes was motivated by a desire for healing.

“I don’t want to help Mrs. Holmes,” he said. “He is not someone who can be helped. At this point, she has to help herself. She must pay her debt to society.

Ms. Holmes stared intently at Dr. Rosendorff throughout her testimony, occasionally taking notes. As she left, arm in arm with Mr Evans, she flashed reporters a smile but did not answer questions.

Outside the courtroom, Dr. Rosendorff ran away from a group of news cameras. A lawyer for Dr. Rosendorff declined to comment.

Judge Davila said he received answers to his questions about the incident. He will decide whether Ms Holmes deserves a new trial in the coming weeks.

Ms Holmes is due to be sentenced on November 18. She should appeal.

Mr. Balwani, who was found guilty of a dozen counts of fraud for Theranos, is expected to be sentenced on November 15. He attempted to rely on Dr Rosendorff’s visit to Ms Holmes to justify his own retrial. The motion was defeated.
Main Source: NYTimes.com