Lance Wade didn’t say aloud “Snitches have stitches,” but with his demeanor in the courtroom today, he didn’t have to. It’s the most aggressive performance we’ve seen so far from Elizabeth Holmes’ defense attorney, and that’s probably because the last testimony is just so bad for the case of Holmes.
At the booth today was the former director of the Theranos laboratory, Adam Rosendorff, who was in charge of the laboratory where patient results were processed. In his opening statement, Wade made it clear that he was prepared to blame Theranos’ lab directors – including Rosendorff – for many of the company’s problems. His questioning of Rosendorff drew two successful objections from the government, for argumentation.
Until now, the defense has used a softer approach. Facing whistleblower Erika Cheung, Holmes’ lawyers have made no attempt to demolish her credibility. Wade was caring, even kind – and used her to present documents and testimonials that would strengthen his client’s case. Along with Surekha Gangakhedkar, who worked in R&D and helped develop many of the company’s tests, Wade presented evidence suggesting that Holmes was a thoughtful boss, who even tried to dissuade Gangakhedkar from resigning.
But today, Wade appeared trapped from the start of his cross-examination. Rosendorff’s testimony earlier today highlighted emails that looked horrific to Holmes, who is on trial for wire fraud and conspiracy to commit wire fraud. They showed Rosendorff grew increasingly frustrated with the testing, management, and Holmes’ brother Christian, who had been squeezed between Rosendorff and the complaining doctors. Perhaps this is why Wade began by aggressively attacking Rosendorff’s credibility.
Wade listed a number of federal agents – along with the FBI, the Postal Service, and the FDA – that Rosendorff had been in a room with, and seemed dismayed Rosendorff couldn’t remember all of their names. (In some cases, Rosendorff said, these agents had not even spoken to him.) Was Rosendorff guided by the government on its responses? Wade asked, almost screaming.
Wade managed to score points, such as when he made Rosendorff tell that Holmes never told him to report an inaccurate result. It showed Rosendorff had already answered a question about why he left Theranos slightly differently under oath two years ago.
Wade also had Rosendorff say that the patient launch we heard about last week – the one Rosendorff wanted to delay – was for friends and family only. I’m not sure the testimonial of the soft launch helped Wade, however. After all, wouldn’t friends and family be Suite understand if the business needed more time to get it right?
The tone changed after we returned from a brief break. (Lawyers often read reporters’ live tweets about their trials, as well as our stories. Hi, Lance!) Wade began to portray Holmes as a Steve Jobs-style marketing genius. Noticeably quieter and friendlier to Rosendorff, he got the former lab director to say that part of the reason he joined Theranos was that he thought it would be the next Apple.
Wade held up Walter Isaacson’s biography of Jobs, which Rosendorff said he had read, as he asked questions. Part of Apple’s success was its intense focus on marketing, right? (Chiat Day, who later worked with Theranos, came up with Apple’s “Think Different.”) And Apple was all about secrecy, right? Judge Edward Davila interrupted that round of questions to say that “now is not the time for a book report,” but by then Wade had hit the highlights.
There was however a fat problem for the Steve Jobs metaphor: Elizabeth Holmes’ brother, Christian.
In an email chain, Christian – who had no medical or scientific background – appeared to usurp Rosendorff’s role as lab manager when a customer service rep asked him to Christian, not Rosendorff, whether to approve a second draw for a failed test.
In another chain of emails, a doctor wrote that a cholesterol test did not match. Rosendorff wrote to Christian that something was wrong with the test. In response, Christian gave Rosendorff an explanatory paragraph to give to the doctor. Rosendorff rejected it, saying he would not defend the test. In response, Christian berated him – and received an “attaboy!” His sister’s email. “You handled this perfectly,” Holmes wrote to his brother.
Thanks to this interference, Rosendorff seemed to be at wit’s end: “100% honesty and transparency towards the patient is essential,” he wrote to Christian. “My first duty is not to Theranos but to the patient in accordance with my Hippocratic Oath ‘premium non nocere’. Christian passed this on to Holmes and Sunny Balwani, Holmes’ co-accused who is on trial separately. Rosendorff ended up sparing the patient another Theranos finger prick and instead used an FDA approved venous pull test.
In another series of emails, Rosendorff said he didn’t feel up to date with what the company was doing. He asked to be removed from the lab license. “I feel obligated to guarantee results that I cannot trust,” he wrote to Holmes.
In response, she wrote: “How sad and disappointing to see this from you. She said he had never raised his concerns before – that’s not true, as we’ve seen emails from him doing so and copying it. Rosendorff also testified on Friday that he met Holmes about his concerns.
There weren’t just a few bad tests that needed to be kept quiet. Theranos has seemed so secretive as to deceive public health officials – with Holmes blessing. When auditors from the California Department of Public Health were scheduled to visit the lab, Holmes emailed Rosendorff and Balwani, among others, to find out where they would be walking. On the day of the inspection, no one was to enter or leave Normandy, the laboratory where the Edison machines were kept, Rosendorff said. To his knowledge, listeners did not see an Edison device that day.
By law, laboratories are required to carry out proficiency tests, which aim to ensure accurate results. Rosendorff “felt that management was pretending to talk about this issue,” he said. He testified that he had not received any resources or support for his proficiency exam plans. Nothing changed by the time he left either. Rosendorff forwarded an email about it to his Gmail account, in case he needed it later.
Eventually he found another job and gave notice, staying for a while so they could find another lab director. Meanwhile, in November 2014, there was another bad test result. Rosendorff was blunt, telling Holmes and Balwani that the accuracy of the test was in question. “Are you both comfortable with this?” he wrote in an email.
In response, Balwani essentially dismissed Rosendorff’s concerns. Rosendorff conveyed this response to Holmes, writing: “I find Sunny’s response offensive and misleading. He should apologize. Holmes then forwarded that email to Balwani, saying they should “cut him off on Monday,” which Rosendorff interpreted to mean they should fire him rather than let him serve his last days.
Of course, Rosendorff spoke to federal officials and knew roughly what questions he would be asked. Yes, the launch Rosendorff testified to on Friday was a “soft launch”. But that’s not about email after email of patient complaints, or Rosendorff’s increasingly direct efforts to tackle bad testing. That certainly doesn’t explain Christian Holmes’ involvement, or why his sister praised him for slapping Rosendorff, his lab director.
Rosendorff’s cross-examination will continue tomorrow. But so far, little has been produced to undermine it – and the emails that have been introduced reinforce it. They also raise a lot of questions about Elizabeth Holmes’ credibility, and that’s going to be hard to explain.