Ramesh Balwani | |
---|---|
Born | [1] | June 13, 1965
Other names | Sunny Balwani |
Education | University of Texas, Austin (BS) University of California, Berkeley (MBA) Stanford University |
Known for |
|
Criminal status | Incarcerated April 20, 2023 |
Conviction(s) | 2 counts of conspiring with Holmes, 6 counts of defrauding investors and 4 counts of patient fraud (2022) |
Criminal penalty | 12 years and 11 months |
Accomplice(s) | Elizabeth Holmes (2003–2016) |
Imprisoned at | Terminal Island FCI |
Ramesh "Sunny" Balwani (born June 13, 1965) [1] is a businessman, former president and chief operating officer of Theranos, which was a privately held health technology company founded by his then-girlfriend Elizabeth Holmes. He and Holmes fraudulently represented that they had devised a revolutionary blood test that required only small amounts of blood, such as from a fingerstick. Both Balwani and Holmes were convicted of fraud. [3] The consequences of the fraud led to the collapse of Theranos and the loss of billions of dollars to investors. [4]
Starting in 2015, Theranos came under criticism in the media due to its questionable claims and practices. The company was eventually liquidated. Balwani and Holmes were criminally charged by federal authorities for operating the business as a multi-million dollar scheme to defraud investors and patients. Holmes was found guilty and sentenced to 11 years and 3 months in prison. [5] Balwani was found guilty on all counts. [6]
He was sentenced to 12 years and 11 months, plus three years of probation and surrendered on April 20, 2023. [7] [8] Holmes and Balwani were further ordered to pay $452 million to the victims of the fraud, with responsibility for the payment shared between them. [9] Balwani was portrayed by Naveen Andrews in the 2022 miniseries The Dropout , which documented his relationship with Holmes and his role within Theranos. [10]
Ramesh Balwani was born in West Pakistan (Sindh, Pakistan), into an upper middle-class Sindhi Hindu farming family. [11] [2] [12] He attended Aitchison College, a prestigious boarding school in Lahore, until 1984. [2] Balwani speaks Sindhi, Urdu, Hindi and English. [2]
His family eventually moved to India "because being a Hindu in a mostly all-Muslim country of Pakistan was very difficult" according to Balwani's personal lawyer. [11] Later they immigrated to the United States. In the Spring 1987 semester, Balwani began undergraduate studies at the University of Texas at Austin as an international student where he was a member of the Pakistani Students Association. [13] [14] [2] "He was very patriotically Pakistani," said one friend of Balwani's at the time, "He was one of us." [2] Balwani left the campus sometime after 1991 to begin working; he would eventually complete a degree, but not until 1997 with a bachelor's in information systems. [14] [2]
Despite research into the question by The New York Times, it is unknown when, or why, he took the nickname "Sunny". In official documents from the late 1990s and on divorce papers from 2002, he was known as Ramesh, his given name. By 2012, he was signing papers at Theranos as Sunny Balwani. [15]
In the 1990s, Balwani worked for Lotus Software and Microsoft. During Balwani's tenure at Microsoft he worked in sales. [2] He claims to have written thousands of lines of code. However, independent investigations could not verify this, and numerous Microsoft managers who were asked about him could not remember him. [2] While at Microsoft, he met a Japanese artist, Keiko Fujimoto, who became his wife. [2]
In late 1999 he joined CommerceBid.com as president. [2] It was a software development company that helped businesses buy and sell items via auctions over the burgeoning Internet. [14] [16] In 1999, the company was purchased by Commerce One, another business development software company with a high valuation. The buyout was done entirely with stock, [14] and Balwani joined the board of the new company. In July 2000, Balwani sold his shares in Commerce One, netting nearly $40 million shortly before the company went out of business, just before the dot com bubble burst. [14] [17] He later went back to school and received a Master of Business Administration from the University of California, Berkeley in 2003. [14] He spent another four years in a computer science graduate program at Stanford University, but dropped out in 2008. [14]
While enrolled at Berkeley, Balwani, who was 37 at the time, met Elizabeth Holmes, who was 18 and in her senior year of high school. [17] Holmes pursued an undergraduate degree in chemical engineering at Stanford, [17] but later dropped out to focus full-time on Theranos. [18]
Balwani joined Theranos in 2009. He ran the company's day-to-day operations as its president. [19] He had no training in biological sciences or medical devices, [19] which became an issue due to the absence of medical experts on the company's board of directors and Balwani's behavior. He was described by former Theranos employees as overbearing, uncompromising and so concerned about industrial espionage that he verged on paranoia. [17]
Within Theranos, Balwani was known for using technical terms he seemingly did not understand in what others believed were attempts to appear more knowledgeable. [17] Balwani at one point claimed "This invention [the Edison blood testing device] is going to be way up there, um, with – with the discovery of antibiotics." [19] He once misheard "end effector" (the claw or other device at the end of an automated robot's arm) as "endofactor" (a nonsense word) and repeated the error throughout a meeting, furthermore not noticing when "Endofactor" was subsequently used as a prank in a PowerPoint presentation. [17]
The Wall Street Journal reported in October 2015 that the Edison blood testing device by Theranos produced inaccurate medical diagnoses and results. [20] Edison machines frequently failed quality-control checks and produced widely varying results, a finding that was corroborated in a report released in March 2016 by the federal Centers for Medicare and Medicaid Services (CMS). [21] In April 2016, Theranos told regulators it had voided all test results from Edison machines for 2014 and 2015, as well as some other tests it ran on conventional machines. [21]
In January 2016, the CMS sent a warning letter to Theranos after inspecting its laboratory in Newark, California. [22] CMS regulators proposed a two-year ban on Balwani from owning or operating a blood lab after the company had not fixed problems within its California lab in March 2016. [23]
The other charges of fraud against Theranos include claiming the company's technology was being used by the U.S. Department of Defense in combat situations. [24] Another false claim included claiming a $100 million revenue stream in 2014 that was actually $100,000. [25] Balwani departed from his position at Theranos in May 2016.
In March 2018, Balwani and Holmes were charged by the SEC with securities fraud, "raising more than $700 million from investors through an elaborate, years-long fraud in which they exaggerated or made false statements about the company's technology, business, and financial performance". [26] Holmes settled the case out of court without admitting or denying wrongdoing, but Balwani was still in litigation as of 2022. [26] He said he was innocent of the charges. [26] [27]
On June 15, 2018, following an investigation by the U.S. Attorney's Office in San Francisco that lasted more than two years, a federal grand jury indicted president Balwani and CEO Holmes on nine counts of wire fraud and two counts of conspiracy to commit wire fraud. [28] [29] Prosecutors alleged that Holmes and Balwani engaged in two criminal schemes, one to defraud investors, the other to defraud patients. [28] In March 2020, a U.S. District Court Judge ordered that Balwani would stand trial separately from Holmes. In January 2022, Holmes was found guilty on multiple counts of fraud. [30]
On July 7, 2022, Balwani was found guilty on all counts and faced up to 20 years in prison and millions of dollars in restitution. He received a sentence of 12 years 11 months in prison, plus three years of probation on December 7, 2022. He was ordered to self-surrender by March 15, 2023, which a judge later amended to March 16. [6] [31] Balwani moved for appellate bail, but the judge denied his motion, citing a low likelihood of the appeal succeeding. [32] Balwani later appealed this ruling, which triggered an automatic stay of his sentence. [33] On April 7, 2023, the Ninth Circuit Court of Appeals refused Balwani's request, and a new self-surrender date was set for April 20. He surrendered on that date. [34]
He was incarcerated at Federal Correctional Institution, Terminal Island, in San Pedro, California. [35] In May 2023 during the restitution phase, Holmes and Balwani were ordered to pay $452 million to the victims of the fraud, with responsibility for the payment shared between them. [9]
He was married to Japanese artist Keiko Fujimoto. [17] Fujimoto and Balwani lived in San Francisco before their divorce in December 2002. [36]
Balwani was in a romantic relationship with Elizabeth Holmes during his tenure at Theranos. [37] [38] Holmes met him in 2002 at age 18, while still in school. He was 19 years older than Holmes and married at the time. [37] Their relationship was not disclosed to their Theranos investors. [39] During her trial, Holmes testified that she had been raped while she was a student at Stanford and that she had sought solace from Balwani in the aftermath of the incident. [40] [41] She also claimed that during her romantic relationship with Balwani, which lasted more than a decade, he was a very controlling figure and that he berated and sexually abused her. [41] [40] In her court testimony, Holmes stated that Balwani wanted to "kill the person" she was and make her into a "new Elizabeth". [41] However, she later testified that Balwani had not forced her to make the false statements to investors, business partners, journalists and company directors that had been described in the case. [42] In court filings, Balwani and his ex-wife Fujimoto have "categorically" denied abuse allegations, calling them "false and inflammatory". [43]
David Boies is an American lawyer and chairman of the law firm Boies Schiller Flexner LLP. Boies rose to national prominence for three major cases: leading the U.S. federal government's successful prosecution of Microsoft in United States v. Microsoft Corp., his unsuccessful representation of Democratic presidential candidate Al Gore in Bush v. Gore, and for successful representation of the plaintiff in Hollingsworth v. Perry, which invalidated California Proposition 8 banning same-sex marriage. Boies has also represented various clients in U.S. lawsuits, including Theranos, tobacco companies, Harvey Weinstein, and Jeffrey Epstein's victims including Virginia Roberts Giuffre.
The Association for Diagnostics & Laboratory Medicine is a global scientific society dedicated to clinical laboratory science and its application to healthcare. ADLM's current president is Octavia M. Peck Palmer, PhD, FAAC, and the association headquarters are located in Washington, D.C..
Crime in California refers to crime occurring within the U.S. state of California. The principal source of law for California criminal procedure is the California Penal Code.
Edward John Davila is an American lawyer who serves as a senior United States district judge of the United States District Court for the Northern District of California. He was previously a California state court judge of the Santa Clara County Superior Court from 2001 to 2011.
Wade Miquelon is an American business executive and former CEO of Jo-Ann Stores. He was previously an executive at Procter & Gamble and Walgreens.
Theranos Inc. was an American privately held corporation that was touted as a breakthrough health technology company. Founded in 2003 by then 19-year-old Elizabeth Holmes, Theranos raised more than US$700 million from venture capitalists and private investors, resulting in a $9 billion valuation at its peak in 2013 and 2014. The company claimed that it had devised blood tests that required very small amounts of blood and that could be performed rapidly and accurately, all using compact automated devices that the company had developed. These claims were proven to be false.
Elizabeth Anne Holmes is an American biotechnology entrepreneur who was convicted of fraud in connection with her blood-testing company, Theranos. The company's valuation soared after it claimed to have revolutionized blood testing by developing methods that needed only very small volumes of blood, such as from a fingerprick. In 2015, Forbes had named Holmes the youngest and wealthiest self-made female billionaire in the United States on the basis of a $9-billion valuation of her company. In the following year, as revelations of fraud about Theranos's claims began to surface, Forbes revised its estimate of Holmes's net worth to zero, and Fortune named her in its feature article on "The World's 19 Most Disappointing Leaders".
Noble cause corruption is corruption caused by the adherence to a teleological ethical system, suggesting that people will use unethical or illegal means to attain desirable goals, a result which appears to benefit the greater good. Where traditional corruption is defined by personal gain, noble cause corruption forms when someone is convinced of their righteousness, and will do anything within their powers to achieve the desired result. An example of noble cause corruption is police misconduct "committed in the name of good ends" or neglect of due process through "a moral commitment to make the world a safer place to live." The knowing misconduct by a law enforcement officer or prosecutor with the goal of attaining what the officer believes is a "just" result.
Joseph Fuisz is an American attorney, inventor, and entrepreneur of Slovenian descent. He works predominantly in the pharmaceutical industry as the founder of Fuisz Pharma LLC. As of October 2015, he is named on 32 medical patents, and over forty patents.
John Carreyrou is a French-American investigative reporter at The New York Times. Carreyrou worked for The Wall Street Journal for 20 years between 1999 and 2019 and has been based in Brussels, Paris, and New York City. He won the Pulitzer Prize twice and helped expose the fraudulent practices of the multibillion-dollar blood-testing company Theranos in a series of articles published in The Wall Street Journal.
Bad Blood: Secrets and Lies in a Silicon Valley Startup is a nonfiction book by journalist John Carreyrou, released May 21, 2018. It covers the rise and fall of Theranos, the multibillion-dollar biotech startup headed by Elizabeth Holmes. The book received critical acclaim, winning the 2018 Financial Times and McKinsey Business Book of the Year Award.
Ian Gibbons was a British biochemist and molecular biology researcher who served as the chief scientist of the US company Theranos, which was founded by Elizabeth Holmes. For more than 30 years, Gibbons performed research in medical therapeutics and diagnostic testing prior to joining Theranos in 2005. He attempted to raise issues with Theranos' management about the inaccuracy of their testing devices.
The Inventor: Out for Blood in Silicon Valley is a 2019 American documentary film, directed and produced by Alex Gibney. The film revolves around Elizabeth Holmes and her former company Theranos. It is considered a companion piece to the book, Bad Blood: Secrets and Lies in a Silicon Valley Startup.
The Dropout is an American biographical drama television miniseries that dramatizes the rise and fall of the disgraced biotechnology company Theranos and its founder, Elizabeth Holmes, played by Amanda Seyfried. It features an ensemble supporting cast, including Naveen Andrews, Elizabeth Marvel, William H. Macy, Stephen Fry, Mary Lynn Rajskub, Bill Irwin, Utkarsh Ambudkar, LisaGay Hamilton, Michael Ironside, Laurie Metcalf, Anne Archer, and Sam Waterston. Created by Elizabeth Meriwether, the series is based on the podcast of the same name hosted by Rebecca Jarvis and produced by ABC News.
Channing Rex Robertson is a professor emeritus of chemical engineering at Stanford University. He held multiple significant roles at startup Theranos, founded by his student Elizabeth Holmes. Robertson took on major responsibilities at the company prior to its collapse, including becoming its first board member, engaging with venture capitalists, and recruiting biochemist Ian Gibbons. He retired from Stanford in 2012, becoming professor emeritus. Theranos named him the co-leader of their technology advisory board in 2017. He was called as a witness in United States v. Elizabeth A. Holmes, et al., which convicted Holmes and partner Sunny Balwani of criminal fraud. During his time working for Holmes, Robertson was paid US$500,000 per year by Theranos. Since his active role in the Theranos scandal, he went back to teach one course at Stanford.
Phyllis I. Gardner is a Professor of Medicine at the Stanford University School of Medicine, and former Dean of Education. Gardner was one of the first people to be publicly skeptical of Elizabeth Holmes, the founder of blood testing company Theranos, who was later found guilty of investor fraud.
The Dropout is an American true crime podcast hosted by Rebecca Jarvis that follows the story of Elizabeth Holmes, her defunct medical company Theranos, and the related federal criminal fraud trial, United States v. Elizabeth A. Holmes, et al. It was produced by ABC News, Taylor Dunn, Victoria Thompson, and Rebecca Jarvis. After the initial six episodes of the podcast aired in 2019, a two-hour 20/20 episode premiered in March 2019, following the popularity of the podcast. A second season of the podcast, titled, The Dropout: Elizabeth Holmes on Trial, debuted in 2022 and followed along with the criminal fraud federal trial of Holmes.
United States v. Elizabeth A. Holmes, et al., was a United States federal criminal fraud case against the founder of now-defunct corporation Theranos, Elizabeth Holmes, and its former president and COO, Ramesh Balwani. The case alleged that Holmes and Balwani perpetrated multi-million dollar wire-fraud schemes against investors and patients. They had separate jury trials.
He was born in Pakistan to a Hindu family, and eventually the family had to move to India because being a Hindu in a mostly all-Muslim country of Pakistan was very difficult. (Balwani's Personal Lawyer)