Disgraced Theranos founder will blame ‘abusive’ ex-boyfriend in fraud trial

The disgraced founder of the blood-testing startup Theranos plans to blame emotional and sexual abuse by her former boyfriend, also a senior executive at the company, at her federal fraud trial beginning next week, according to legal papers published on Saturday.

Elizabeth Holmes, 37, says she is not responsible for decisions she made as head of the company because her mind was impaired by “manipulation” from Ramesh “Sunny” Balwani, 56, the chief operating officer of Theranos who faces a separate fraud trial next year.

Holmes and Balwani, who was also the company’s president, have both pleaded not guilty to charges they defrauded investors, doctors and patients.

The filing in US district court in San Jose, California, by Holmes’s lawyers was published on Saturday by NPR. It outlines for the first time her strategy to defend herself against claims she ripped off patients and investors for hundreds of millions of dollars. It says Holmes is likely to take the stand.

The trial, delayed earlier this year by Holmes’s pregnancy, is scheduled to begin on Tuesday and last several months.

Jurors will hear allegations that Holmes raised more than $700m from investors on claims Theranos invented a revolutionary machine that could conduct hundreds of laboratory tests from a single finger-prick of blood, but was actually using other companies’ technology for the tests. The company folded in 2018.

“This pattern of abuse and coercive control continued over the approximately decade-long duration of Ms Holmes and Mr Balwani’s relationship, including during the period of the charged conspiracies,” the filing states.

Citing the syndrome known as intimate partner abuse, the lawyers claim: “Mr Balwani was controlling with Ms Holmes, that Ms Holmes was isolated by Mr Balwani, that Mr Balwani was combative with Ms Holmes, and that Mr Balwani was often physically present in Ms Holmes’ office, all tactics that … are abuse tactics used by abusers.”

Holmes has claimed in previous filings that Balwani was sexually abusive, “withdrew affection if she displeased him, controlled what she ate, how she dressed, how much money she could spend, who she could interact with”. He also threw “hard, sharp objects at her” and controlled her sleep, lawyers have said.

But this is the first declaration by Holmes’s legal team that she plans to use the alleged abuse as a defense of her actions, claiming Balwani was “dominating her and erasing her capacity to make decisions”. As a result, the attorneys claim, it affected Holmes’s ability “to deceive her victims”.

Lawyers for Balwani have called Holmes’s allegations “outrageous, salacious and inflammatory”.

Holmes dropped out of Stanford University at 19 and became a star in a startup space dominated by men. She founded Theranos in 2003, with the goal of revolutionizing blood testing. The company’s rise and fall became a cautionary tale about the Silicon Valley hype machine.

Theranos received glowing media coverage and raised more than $700m from investors on claims it had invented a machine that could conduct hundreds of laboratory tests from a single prick.

The tests were rolled out in Walgreens stores and Theranos reached a $9bn valuation before it became clear that many of the claims about the supposedly revolutionary blood test were bogus.

The story became the subject of the ABC News true crime podcast, The Dropout.

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