Elizabeth Holmes trial: Lawyer claims ‘incompetent’ lab chief, not Holmes, to blame
A lawyer for Theranos founder Elizabeth Holmes claimed during her criminal trial Tuesday that “incompetence” by former company lab director Adam Rosendorff was behind problems at her Palo Alto blood-testing startup.
“To the extent that failures in the lab are the result of incompetence of someone other than my client, it’s exculpatory for my client,” Holmes lawyer Lance Wade said in a hearing without the jury present.
Rosendorff has been on the witness stand for five days so far in U.S. District Court in San Jose, where Holmes — sitting upright throughout the proceedings flanked by two high-profile Washington, D.C. lawyers — is facing 12 felony charges.
The ex-lab director, who blew the whistle on what he said he witnessed at Theranos to the Wall Street Journal, has testified that the company cared more about PR and fundraising than patients, and that he quit over concerns about severe problems with test-result accuracy.
On Tuesday, Holmes lawyer Lance Wade outlined problems at other companies where Rosendorff worked after leaving Theranos in November 2014, about a year-and-a-half after joining the company.
Wade sought to link Rosendorff to the re-testing of 50,000 patients at the biotechnology company where Rosendorff landed after Theranos, which he said was the result of “unreliable test results.” Rosendorff left the company “immediately after… disclosure of the results,” Wade told Judge Edward Davila.
Wade also drew a line between Rosendorff and the federal indictments of two executives at failed Silicon Valley fecal-testing startup uBiome, where Rosendorff also worked and where, according to Wade, he was fired for not showing up. Wade also alleged that at Rosendorff’s current place of work, Massachusetts-based health-technology firm PerkinElmer, federal inspectors had issued a notice of “serious deficiencies” in the lab and in Rosendorff’s work.
“He’s pointed the finger at many other people, including my client,” Wade said. “He appears to almost never have competently done his job. He was incompetent at Theranos, too, and that is the reason many of the failures happened. He’s the person who’s ultimately responsible in the laboratory.”
Wade further claimed that because Rosendorff’s current employer and his work there is under federal investigation, he is biased in favor of the prosecution, which called him to testify against Holmes. “His career hangs in the balance at the hands of the federal government.” Wade alleged.
Holmes, a Stanford University dropout who founded Theranos in 2003, is accused of bilking investors out of hundreds of millions of dollars and misleading patients and doctors with false claims that her firm’s machines could conduct a full range of tests using only a few drops of blood from a finger-stick. She has pleaded not guilty.
Federal prosecutor John Bostic argued to Davila that Holmes’ legal team should not be able to put Rosendorff’s work at other companies before the jury. “What the defense is trying to do here is to bring in unrelated conduct,” Bostic said. “That is not a proper use of that kind of evidence.”
The firm that re-tested 50,000 patients out of caution reported that only two to 15 people were found to have been affected, Bostic said. “The way Mr. Wade has characterized this as 50,000 inaccurate results is incorrect,” Bostic said.
Rosendorff’s work at uBiome had nothing to do with the allegations in the indictments of the company’s executives, and it’s unclear whether he was fired from the startup, Bostic said. He added that Rosendorff’s work in his current job “obviously has nothing to do with the laboratory of Theranos.”
Bostic called Wade’s claim that Rosendorff is beholden to the federal government irrelevant and “completely speculative,” and asserted there was no connection between Rosendorff’s testimony and a federal investigation of the other company.
Rosendorff, a tall man with gray hair and dark-rimmed glasses, took the stand again Tuesday after the hearing. As his testimony got underway, Wade got Rosendorff to agree that his testimony about frequent problematic test results at Theranos diverged from what he’d said during a deposition before the trial.
Quoting that deposition, Wade noted Rosendorff had said then that “I don’t think I had a greater number of tests that were anomalous that I had to review as lab director at Theranos than at other places I’d been.”
“That’s 180 degrees from what you answered in your direct testimony, correct?” Wade said.
“Yes, it seems to be different,” Rosendorff admitted, but added that his work prior to Theranos had been at higher-volume lab.
In the afternoon, Davila said he would let Holmes’ legal team question Rosendorff to a limited extent about his work at PerkinElmer. Rosendorff, under questioning by Wade, said that at PerkinElmer, he communicated with some of the same U.S. Centers for Medicare and Medicaid investigators who had earlier probed Theranos. Rosendorff acknowledged that one of the agents looking into PerkinElmer had told him that his license to work as a lab director could be suspended, depending on the results of that probe.
Holmes, whose mother Noel and partner Billy Evans — the father of her newborn baby — sat in the courtroom gallery as they often have during the trial, faces up to 20 years in prison if she is convicted. Her trial, which started Sept. 8, is expected to last until at least early December.