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Elizabeth Holmes SEC Deposition JULY 11, 2017 1 OF 4 redacted — Transcript

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0:06we are on the record at the beginning of
0:09media number one volume one
0:12contracted by Han and bowersock please
0:15begin
0:17this is the testimony of Elizabeth
0:18Holmes going on the record in San
0:20Francisco California at nine o'clock AM
0:24I 11 2017. this close please raise your
0:27right hand
0:29do you swear to tell the truth the whole
0:30truth and nothing but the truth I do
0:33thank you
0:35my name is Jessica Chan and with me are
0:37Rahul kolhekar Monique Winkler Michael
0:40Foley Mark hats in the back and Jason
0:43habermeyer
0:44I am Rick wolkolikar are staff attorneys
0:47in this office Mr Foley is a staff
0:50accountant Ms Winkler is an assistant
0:53director in this office and Mr
0:55havermeyer and Mr Katz are trial Council
0:58in the San Francisco regional office of
0:59the United States security as an
1:01Exchange Commission we are officers of
1:03the commission for the purposes of this
1:04proceeding
1:05this is an investigation by the security
1:07as an Exchange Commission and the matter
1:09if theran is Inc sf4030 to determine
1:12whether there have been violations of
1:14certain provisions of the federal
1:15Securities laws however the facts
1:17developed in this investigation might
1:19constitute violations of other federal
1:21or state civil or criminal laws
1:24prior to the opening of the record you
1:26were provided with a copy of the formal
1:28order of Investigation in this matter
1:30the formal order will be available for
1:33your examination during the course of
1:34this proceeding
1:36have you had an opportunity to review
1:37the formal order
1:39I'm not sure if I've reviewed it but I
1:41know our team has it
1:43do you have any questions about it I
1:45don't
1:46prior to the opening of the record you
1:47were also provided with a copy of the
1:49commission supplement Information Form
1:511662 which has been marked as theirrnes
1:53exhibit one have you had an opportunity
1:56to review the Civic one I have
1:58you also received this forum 1662 with
2:01your subpoena for Testimony correct yes
2:03do you have any questions about exhibit
2:05one I don't
2:08those homes are you represented by
2:09Council Council today I am would Council
2:12please identify themselves and if you
2:14wouldn't mind providing your firm name
2:15address and phone number as well I'm
2:18Stephen Neal with Cooley my phone number
2:21is
2:23650-843-5182 and I'm one of the
2:25attorneys representing Ms Holmes John do
2:27I also have pool at 650-843-5000
2:31uh David Taylor The General Counsel of
2:33fairness
2:35Chris Davies of Wilmer 202-663-6187
2:40bill mclook is Wilmer 202-663-6622
2:46Ali Leeper with Cooley a minute for my
2:49phone number
2:50650-843-5376
2:55and would you also provide your office
2:57addresses as well
2:59for all three Coulee people our office
3:01address is 3175 Hanover Street Palo Alto
3:0694304
3:11a 1701 Page Mill Road Palo Alto
3:1594304 and Bill and I are at 1875
3:18Pennsylvania Avenue Washington dc2006
3:22do you represent Ms Holmes in her
3:25personal capacity I represent Ms Holmes
3:27in all capacities
3:29and what about Mr Taylor and and the
3:32attorneys from Wilmer I represent the
3:34company fairness
3:36represent the company and Ms Holmes's
3:37CEO sing the company and Miss Owens
3:43before we start today I want to go over
3:45some ground rules with you the court
3:46reporter will be recording and
3:48transcribing what we say so it's
3:50important for us to talk only one at a
3:52time so if you could please wait until I
3:54finish my question before you answer and
3:55I'll try and do the same I I won't ask
3:57the next question before you finish your
3:59answer as well for the same reason it's
4:01important that you answer audibly and
4:04don't respond with gestures even though
4:07it's a less formal setting the oath you
4:09just made has the same effect as if you
4:11were testifying in court and carries
4:13with it the same penalty for perjury it
4:15is also a crime to knowingly present
4:17false information during the course of
4:19this investigation do you understand I
4:21do if there's anything you don't
4:22understand please let me know so that I
4:24can repeat or rephrase the question if
4:26you don't tell me you don't understand
4:27then I'll just assume that you do
4:29understand the questions asked if you
4:31need to take a break at any time just
4:32let me know and we can take a break the
4:34only thing that I ask is that you're not
4:36asked to take a break while a question
4:38is petting before you yeah
4:40are you taking any medications that
4:42would impair your ability to understand
4:43my questions or answer fully and
4:46truthfully no
4:47is there any reason why you can't give
4:49full complete and truthful testimony
4:51today no
4:55I'm handing to you what's been marked as
4:57they're an exhibit 191.
5:06one more hobby that's right
5:10this is a subpoena that we issue for
5:12your testimony are you appearing here
5:14today pursuant to The subpoena I am
5:16thank you and you can put that to the
5:18side over here
5:20we'll start making a pile on the center
5:23of the table
5:51also going to hand to you what's been
5:53marked exhibit 192.
5:58exhibit 192. reports to be a background
6:02questionnaire that's dated July
6:12July 10th okay or is it July 2nd July
6:152nd but it's like 2017.
6:20could you also send us a revised
6:21questionnaire yesterday which is July
6:2310th we did
6:27um
6:30have you seen exhibit 192 before
6:34I have what is exhibit 192.
6:37uh the completed background
6:38questionnaire
6:40complete the questionnaire honor about
6:42July 2nd 2017. yes
6:48is the information and exhibit 192 true
6:51and correct to the best of your
6:52knowledge it is
6:55and if you would turn to
6:57page four of the questionnaire
7:00[Applause]
7:04under Securities accounts number
7:06question number 15. he noted here
7:10in this questionnaire that yes I'm not
7:14sure exactly but I'm I'm not completely
7:16sure and if you would look over at page
7:19five then there are
7:22to bank accounts listed there what are
7:26the source of funds for these accounts
7:28despite my paycheck from theranos
7:33return to page seven
7:39is this an accurate reflection at the
7:40bottom your answer to question 26
7:43regarding your educational history
7:47yes
7:49and then going on to page nine under
7:52your employment history which is
7:54question 32.
7:56uh and going on to page 10 is that an
7:59accurate reflection of your employment
8:00history yes
8:02you can put that aside
8:08thank you
8:13so I wanted to start with uh the time
8:18period starting in 2010 and just let's
8:20just focus on the year 2010 for a moment
8:24um
8:24if you could just tell us the state of
8:26fairness at that time I think that would
8:28be helpful just in terms of how many
8:30employees you had where you were located
8:32if you had an office
8:34um
8:35some information about where the company
8:37was at that time
8:39absolutely it was seven years ago so I
8:42don't remember exactly I I think our
8:45offices were at 3200 Hillview and we
8:48were
8:50probably about
8:53um
8:56100 employees or so I would guess maybe
8:59150 and
9:01we were beginning to engage with
9:05uh retail pharmacies on on the idea that
9:09we had to bring our technology to to
9:13retail locations
9:17working with you in management at that
9:19time
9:20I I believe Sonny balwani was our
9:23president at that time and and Chief
9:25Operating Officer
9:26is there anyone else who is operating
9:28the company with you besides Mr bologna
9:31yeah I'm
9:33trying to remember I I don't think we
9:35had uh
9:37other Senior Management members at that
9:39time we had I think a couple inside
9:41from a technology perspective
9:46I believe on the assay development side
9:48may still have been there and
9:52um
9:54I believe was there at that time I don't
9:56know if he was betrayed a couple others
9:57what were his roles at
10:00that I was focused on the two aspects of
10:03our Hardware which is the consumables
10:05and the device I think at that point
10:07probably more in the consumables than
10:09the device started focusing on
10:11computational biosciences which is sort
10:14of the algorithms and then expanded into
10:17a broader product role over time
10:20so just understand what do you mean by
10:22consumables I'm sorry uh the pieces of
10:26plastic that go into the device we call
10:29them cartridges it's the it's the the
10:31plastic pieces that our chemicals go
10:33into for our distributed testing device
10:37so tell us what what products theranos
10:39had at the time had developed at that
10:41time
10:43um so we had an earlier version of what
10:46we call our mini lab system
10:49um that is the distributed testing
10:51device and we'd invested in development
10:55of a large number of chemistries
10:58for a very broad range of different
11:01tests and
11:05um
11:06and then the associated software sort of
11:09foundational pieces for doing predictive
11:11modeling
11:13you allowed to
11:15the mini 11 2010 yes
11:17um it ran a set of
11:22well we had two versions of it I think
11:24at that point there was the 3.5 device
11:26which ran a set of immuno chemistries
11:29and then there was a four series
11:30platform that we were working on that
11:33could run a broad range of test methods
11:36so the 3.5 version how many tests could
11:40it run
11:41at that time in 2010.
11:44um
11:45I I don't know exactly what the number
11:47was I think just from the development
11:49reports that I've seen that there was
11:51probably
11:52um
11:55tens of of tests I mean we got up to
11:58about
11:59somewhere between 70 to 90
12:01immunochemistries I'm not sure exactly
12:03what time we finished them so it would
12:05have would have been tens at least in
12:07that period of time
12:08and you say that you reviewed some
12:11development reports what are those
12:12development reports
12:13reports I'm the reports for all the
12:16chemistries that we had worked on for
12:19our small sample testing method
12:24are these develop are these development
12:26reports
12:27um are they put together by the
12:29chemistry groups at fairness yes okay so
12:32they're the development of an assay and
12:34the chemistry that go along with it had
12:37you had you transferred those
12:39chemistries onto the platform onto the
12:41mini lab platform at that time
12:43uh yes
12:44I'm a number of them where there's
12:46probably some that we hadn't but but yes
12:49how many have been transferred onto the
12:503.5 I I don't know specifically in 2010
12:54but again I think it's probably at least
12:56tens of of tests
12:59So when you say tons of tests you mean
13:00something less than 100 yes
13:04um
13:04and who would know how many of these
13:07tests have been transferred onto your
13:08platform
13:10as of 2010 yes
13:12um
13:16I I don't know specifically I'm sure as
13:20a team we could go back and try to look
13:21at the dates of all the development
13:23reports yeah I don't know if there's one
13:25person that necessarily knows that now
13:28I'm
13:30I'm not sure
13:31had those tests um you said tens tons of
13:34tests had those tests been validated on
13:36the mini Lab at that time on the 3.5
13:39they had to what we understood
13:42validation to mean our understanding of
13:45what was required for validation changed
13:47later but at that point we thought they
13:49were okay what was your understanding of
13:51what validation meant in 2010
13:53there was a basic guidance document that
13:57we had
13:59become familiar with through the work we
14:01were doing for pharmaceutical companies
14:03on assay development and we thought that
14:05if we developed and tested or validated
14:08the test to that guidance document the
14:11test was validated what guidance
14:13document is that
14:14I I don't know specifically I think it's
14:16based on FDA guidelines for development
14:19of a of a test
14:22Who provided that guidance document to
14:23you
14:25um I believe through the development
14:28work that we did for either centicor or
14:30Celgene it at least affirmed our
14:33understanding of that guidance document
14:35yeah I'm
14:36I'm not sure if we had it specifically
14:38before that
14:40did you review that document
14:43did I personally did you personally
14:44review that document
14:46I don't think so he reviewed it on your
14:48team
14:49um
14:50whoever was leading the essay
14:52development at that time
14:54who do you think that was was it I I
14:56don't know
14:58okay and then also for your mini lab I
15:01think you mentioned was it a 4.0 device
15:05so I called it four series which series
15:07there's been many of them in that in
15:10that iteration that we've been working
15:12on okay
15:13so what could the four series mini lab
15:14do
15:15so at that point I think what we'd shown
15:18was the capability of the different
15:20detectors that are in it to
15:24function with these different methods
15:27namely
15:29different tests you know use different
15:32methods to measure things and we were
15:34trying to get a range of methods so that
15:36we could measure more things on the
15:38device
15:39so how many tests Could That device
15:41perform in 2010 I don't know
15:45was that is it fair to say that the
15:48device was still in development then
15:49absolutely okay what were you using the
15:523.5 device to do were you using it for
15:55patient testing or for any of your
15:56clinical trials
15:58we did
16:00um
16:01and to be clear I'm not sure if it was
16:03the 3.5 or the 3.0 at that time in 2010
16:08um we used
16:10that system for pharmaceutical clinical
16:14studies and then also for a study we did
16:17for the dod at Fort Sam Houston and a
16:22series of burn hospitals
16:24so you were using you said there was a
16:263.0 and a 3.5 what was the difference
16:29between the two versions they were very
16:32similar the core architecture was the
16:35same I think it was
16:37essentially more robust
16:40robust in what way
16:42um
16:43I don't know specifically I I believe we
16:46improved our manufacturing processes and
16:50um
16:51and I'm not sure what else we did
16:54Who would know what the difference was
16:56between the 3.0 and the 3.5
17:00um
17:02I I believe would know yeah would know
17:05as well
17:08um
17:09depending on when we cut over to the 3.5
17:11I'm just not sure I I can't remember in
17:14the 2010 time period
17:16um where we were on that and and I don't
17:18remember when exactly he left the
17:19company
17:21you mentioned the use of the term
17:23minilab yeah is that what you called it
17:25back in 2010
17:28so
17:29um when Walgreens asked us to go to
17:32Johns Hopkins for a due diligence they
17:35called it a mini Lab at that time and we
17:37began using that term but there were
17:40other terms that were also used so just
17:43because you know
17:44I I'm not a scientist I just want to
17:46understand the different terms that
17:47might be used so
17:49so we've got the mini lab I think you've
17:51said 3.5 and a four series were there
17:54any other kind of terms that the company
17:56called its um distributed testing advice
17:59device in in the 2010 time frame
18:02um I I know that people refer to it as
18:05an Edison device
18:06um and we later refer to it as a tspu
18:10device there may have been others
18:19work for pharmaceutical companies what
18:21type of work was the company doing
18:24and we're developing chemistries to work
18:27on small volumes of sample
18:30and then in some cases putting them onto
18:34this distributed testing platform an
18:37earlier version of many Labs we were
18:40also working on models
18:42to simulate the way that drugs would
18:46work
18:47in people
18:51you said
18:53you were working on models to simulate
18:55the way drugs of working people what
18:56were you trying to understand in that
18:58process
18:59or what were the pharmaceutical
19:01companies trying to understand and how
19:03are you helping them yeah they're trying
19:04to understand if they dose in a certain
19:07way
19:08um is it going to work or is it going to
19:10have a safety issue and we were building
19:13simulations that you could feed data
19:16into to help predict that so that you
19:20could speed up the amount of time that
19:23it would take to actually test it in
19:25humans
19:26and then you also mentioned a second
19:28project you were working on was being
19:31able to test smaller samples was that
19:34something that pharmaceutical companies
19:36were discussing with you the possibility
19:38of doing clinical trials for yes and was
19:41this something that
19:43they initiated or something that you
19:46initiated where you were requesting
19:48their help to conduct these these
19:50clinical trials
19:53um I I think both I mean it was a number
19:56of interactions over over multiple years
19:58before 2010 and we certainly
20:02sought Partnerships early on and and
20:05then
20:07um you had the opportunity to look at
20:09other Partnerships as we started to
20:11build relationships with those farmers
20:14how many companies
20:15did you have contrast with
20:17that in 2010 and 2010
20:20um
20:21I I don't I don't know specifically but
20:23I would guess it was around 10.
20:28um was the company generating any
20:29revenues in 2010
20:32I I don't think so
20:35I I again I don't remember specifically
20:45maybe a little bit from
20:48from the burn study
20:52when you say burn study uh what are you
20:54referring to that was the dod study at
20:57uh through Fort Sam Houston
21:00okay and who are you dealing with on
21:03that study
21:04at the dod at the dod
21:06what was that study for
21:09it was
21:11um seeing if the ability to test smaller
21:14samples would allow you to
21:16get more frequent time points in people
21:19who'd been burned so that you could tell
21:22whether the the filters that you were
21:24putting into their kidneys worked well
21:27enough to flush out their systems
21:30do you know how much money the company
21:32was generating in revenues from that it
21:34would have been very small
21:36when you say very small what do you mean
21:40um I think the the whole contract was a
21:41few hundred thousand dollars
21:45I'm going to hand to you
21:53what's been March
21:55their next exhibit 193.
22:10exit at 193 prefer it to be a January
22:1422nd 2010 email from to Elizabeth Queens
22:21with the subject line for there's an
22:25attachment to the email but the starting
22:28base number is thp fm000690035
22:36and the attachment starts with 39.
22:41have you seen exhibit 193 before
22:46I I don't recognize it but I might have
22:48seen it a long time ago
22:50what is exhibit 193
22:54I'm not quite sure do you mind if I take
22:57a minute to read the emails
23:19foreign
24:00foreign
24:24it looks like some type of draft
24:26financials that prepared for
24:29time
24:32the communications referenced in the
24:34email
24:37um and did you receive exhibit 193 on or
24:41about January 22nd 2010. yes
24:46so you'll see
24:48um
24:49that you're preparing to give a
24:52presentation to ATA Ventures do you know
24:54who ATA Adventures was they're one of
24:57our investors
25:01regarding fairness theranos's financial
25:05situation before this
25:07could ever to have anybody
25:09to them to to ATA Adventures was this a
25:13regular occurrence where you um were you
25:16expected to give presentations to their
25:17board no
25:21so if you turn to the attachment uh
25:24there's some financial statements
25:28and if you turn to the monthly PL which
25:31is
25:33the second page of the financial
25:35statements you'll see that
25:37fairness is on track to generate about
25:40five million dollars in revenues in 2009
25:45is that consistent with your
25:47understanding of the revenues that
25:50theranos is generating at that time
25:53you know I I don't remember
25:55what my understanding was at the time do
25:58you have any reason to believe that this
26:00is this is an accurate representation of
26:03the revenues that the company was
26:04generating at the time
26:06do I have a reason to leave it's
26:07inaccurate is it yeah do you have any
26:09reason to believe that it's inaccurate
26:12no
26:14um and with these revenues be have been
26:17generated from those pharmaceutical
26:19companies and from DOD
26:24um it looks just based on the email
26:25exchange reading it here that they're
26:28all associated with pharmaceutical
26:30companies
26:31if you look back at the email since
26:33we're looking at it right now
26:35um
26:37the third email down on the first page
26:42from she says this Revenue includes
26:44potential adjustments need to agree with
26:46KPMG for cell Gene cenacore sharing plow
26:50and Novartis and there are a number of
26:52dates that she puts next to those
26:55pharmaceutical company names some in
26:582009 assume completion some in June 2010
27:02where all of these contracts coming to a
27:04conclusion around the 2009-2010 time
27:07frame
27:08I don't know
27:10I I just can't remember what is your
27:12what is your knowledge of um when these
27:15contracts came to an end
27:19um
27:20I I have in my mind that the Celgene
27:23relationship went on
27:25for a period longer and I thought that
27:28centecore was also looking at doing
27:30additional programs with us
27:33um
27:34I'm not sure about the other two
27:39so if you go back to the financial
27:41statements which is the attachment to
27:43the email
27:45the monthly BS which do you understand
27:48BS to mean to Stanford balance sheet yes
27:53and if you look at in December 2009 cash
27:57and Investments is 3 point that 3.7
28:00million dollars
28:04does that consistent you see that I'm
28:07sorry December 2009 yes yes is that
28:09consistent with your understanding that
28:10theranos had about 3.7 million dollars
28:13in cash at the end of 20 2009.
28:17I can't remember
28:19do you remember fairness being short on
28:21cash around this time frame
28:23in December of 09 or late 2009
28:30um
28:35you know I I remember that when Sunny
28:37joined the company he bridged the
28:41company so I actually thought that we'd
28:44ended up getting cash in before the end
28:46of 09 I'm not sure from this email
28:50um
28:54I'm I'm not sure
28:57so you said Sonny balwani joined the
28:59company and he bridged the company what
29:00did you mean by that
29:02um he he did a bridge loan for the
29:04company when he joined the board which I
29:05thought was before the end of 2009 but
29:08my dates could be wrong it was a long
29:10time ago when did Sonny balwani join the
29:12company
29:13I I thought in about September of 2009
29:16or August of 2009
29:19but it's from memory it may be off okay
29:22why did Sonny Bell Lonnie need to
29:24provide a bridge for the company
29:26well I knew that we needed cash and we
29:29were deciding whether to do an equity
29:30raise or not and and he had offered to
29:33do this for for the company okay so you
29:36knew some time at the towards the end of
29:382009 that the company was short on cash
29:41yes yeah
29:47what was his bridge to the company what
29:50was the amount of the loan
29:53um
29:55I I don't remember specifically I think
29:57it was about 20 million dollars
30:00what were the terms of that line
30:04was it paid back yes when was it paid
30:07back
30:09um
30:10I don't know specifically
30:13has it been paid back though yes
30:20did there come a time when
30:22um
30:23around the 2010 time frame that you
30:25decided to change the business model
30:27from working for the pharmaceutical
30:29companies to a different business model
30:33we decided we were going to work to
30:35bring our technology to patients and
30:38Physicians we thought we would always
30:40continue the pharmaceutical studies
30:42around the retail model but that that
30:45could serve as a channel for it
30:49and so you said you decided to change
30:52the model to provide services to
30:55Physicians and consumers
30:57so what did you do to to realize that
31:00vision
31:02so you can best answer the question what
31:04do you mean by that so so it sounds like
31:08you know you were
31:11the company was focused on the
31:12pharmaceutical trials I guess pre-2010
31:15and there it sounds like you might have
31:17done a little bit of work after that
31:18period but that the company was looking
31:22then to reach out to Consumers and
31:24Physicians to provide its blood testing
31:26to them would was there how
31:30at that point did you decide that you
31:32were going to reach out to some business
31:34partners to realize that vision would
31:36happen
31:38we did we we thought a lot about what
31:40the rate channel was to make lab testing
31:43more accessible and we became very
31:46interested in the retail pharmacy as as
31:49a channel for lab testing
31:51um I I know we reached out to some and
31:54and I think some may have reached out to
31:56us at that time as well and we engaged
32:00in discussions around partnership
32:02whose idea was it to start focusing on
32:05the retail pharmacy business
32:09I I don't remember specifically I mean
32:11it it it related to what we were doing
32:14with testing of drug levels and so it
32:17almost became a progression from that
32:22um so now I want to sort of focus on the
32:25state of the company in in 2013. since
32:28it's three years later
32:30um what had changed about the company
32:35so 2013 was the year that we launched
32:38our retail infrastructure and so we'd
32:41spend a lot of time getting ready for
32:43that and figuring out how to
32:47operationalize that and and most
32:49importantly moving to
32:51a different business model
32:53which we've referred to as a phase one
32:56phase two approach to introducing our
32:58Technologies where you start with
33:00centralized testing and then you work to
33:02get your distributed testing platform
33:05out
33:06how many how many employees did you have
33:08at the company at that time
33:10um I don't know specifically
33:12had a ground absolutely
33:16um and you know in terms of
33:19um I guess what divisions of the company
33:20had grown since 2010
33:25um I know we've grown our
33:27our assay divisions in terms of the work
33:29on the chemistries that we were doing
33:31and
33:34we at that point had established a
33:36clinical lab and had brought in a lab
33:38director to
33:40run it and
33:42um
33:43I'm sure there was there was growth
33:45across the board
33:46were there any changes in management at
33:48that time
33:50um
33:55I I don't know
33:57specifically I'm
34:00whether there'd been changes on the
34:02product leadership Side by that point
34:04Sunny was still our president and CEO
34:07and
34:08um
34:09and was was largely running operations
34:16were you still at the same Hillview
34:18location by 2013 or at Theron has moved
34:20us up to another location
34:23um
34:24I think it may have been in 2013 that we
34:26moved to 1601 California I'm not sure
34:28exactly when we moved
34:33and from the time in 2010 until 2013 had
34:37the company also raise money
34:41I believe we raised money in 2010 and
34:46then
34:48um
34:50George is a director invested in 2011
34:54and then and then again they I think in
34:56the end of 13 or early 14.
34:59okay so you did some fundraising in 2010
35:02some in 2013 and then some in 2014.
35:05yes I'm not sure if it closed in the end
35:07of 2013 or early 14.
35:11so I'm sorry when you said George is a
35:14director do you refer to George Schultz
35:15yes sorry
35:18for a moment to management of the
35:21company so you mentioned that you and Mr
35:23balwani were would it be fair to say
35:26that you were the senior most Executives
35:28at the company we were this is during
35:30the 2013 time frame so I just want to
35:32focus on the 2013 time frame who else
35:34were senior managers at the company at
35:36the time
35:38well by you said in the 2013 time period
35:42by that point clinical lab and
35:47um
35:48on the product side there would have
35:50been
35:51um
35:52a number of technical leaders I I don't
35:54know who specifically was in leadership
35:56in in 2013.
36:01who did report to you
36:05um I I'm not sure in in his offer letter
36:07Sunny managed him as part of his
36:11oversight of the clinical labs
36:15um and then we talked a little bit about
36:16when Mr balwani was hired but why was he
36:19hired
36:20he originally joined our board and at
36:23that point because we thought we were
36:26going to really be building out these
36:28models and that the ultimate
36:31value of the company was data that a
36:36large portion of our business was going
36:37to be being a software company and we
36:39thought he had a really good background
36:41in software and that he would bring that
36:44leadership as we work to build on that
36:47so you just mentioned that a large part
36:49of the company was the software and you
36:51were going to become a data company so
36:52we thought it would be okay so explain
36:55that a little bit more
36:57um
37:00the the purpose of
37:03what we try to do with mini lab and
37:06getting people access to the Health Data
37:08is so that they can use it hopefully for
37:11purposes of early detection and the way
37:14that will be realized is through models
37:17and algorithms and decision support
37:19systems
37:20we had started with Celgene and building
37:23out those models and we'd done it in a
37:25couple other places and we saw that as
37:27the ultimate product for the company as
37:30we went to go toward serving consumers
37:33and Physicians and so we thought that
37:35theranos would be a sensors and software
37:39company and that the investment in
37:40decision support was how ultimately
37:43people would be able to use this data
37:45for early detection
37:50what were Sunny belwani's qualifications
37:52for the job
37:54you mentioned that you know the company
37:56was hoping to be a software company did
37:58he have qualifications in that sector he
38:01did uh he built a software company and
38:03he had worked at Microsoft and I believe
38:05Lotus when it had started out here
38:09um and did he have any qualifications in
38:11the lab testing business he did not or
38:14in pathology or anything like that not
38:17to my knowledge
38:26foreign
38:52some sort but at the top of that chart
38:55is you Elizabeth Holmes as founder and
38:58CEO with Base number
39:02ts0001 have you seen exhibit 194 before
39:08I I don't know
39:11you don't know that you've seen this
39:13before yeah I don't recognize it but I
39:15might have
39:17um
39:18did the company keep organizational uh
39:21charts for the business
39:24very very loosely
39:29as you look at the people on this chart
39:33when do you think this stretcher might
39:36have existed was this this was produced
39:38to the SEC by the company
39:40uh in I believe 2015 would this have
39:44been an accurate reflection of the
39:47managers who were
39:49the president of the company at that
39:50time
39:54um
39:55I'm just looking at it
39:57so I mean it must have been as of
39:592015
40:05yes these people were all managers in
40:06the company
40:08were there any
40:10um
40:11going back to 2013 were there there
40:14would there be any changes to this chart
40:16the 2013 time frame
40:20yes
40:21what were those changes
40:24many of these people didn't work for the
40:27company at that time and um
40:36I thought of our operating structure a
40:39little bit differently than this
40:42how did you think of your operating
40:43structure in 2013
40:45I'm
40:47I was
40:48very externally focused at that point in
40:51time and we essentially had
40:55we didn't have marketing or or even
40:58internal
41:00general counsel at that point
41:03um we had a product organization that
41:06was really partnering with the CLIA lab
41:08to try to get assays to go live under
41:11the ldt model and so there was sort of
41:13one thing that the company was doing at
41:14that point which was taking these assays
41:17life in the Clio lab
41:20sorry I used a couple of acronyms then
41:22I'm sorry clear and ldt could you just
41:25explain to us what those are absolutely
41:27CLIA I used in the context of referring
41:30to the CLIA lab which was our clinical
41:32lab Clea is the clinical lab Improvement
41:34act which is the regulation for labs
41:37ldt's laboratory developed tests and
41:40those are tests that are developed and
41:42validated in-house and so that's why I
41:46was referring to essentially the product
41:48and clinical lab organization as being
41:50very tightly integrated as of 2013.
41:55so who was in charge of that product
41:56team
41:57I didn't hear that who was in charge of
41:59the product team in 2013.
42:01there would have been assay leads and
42:09and I'm trying to think of whether there
42:11was a single Hardware lead at that point
42:13I'm not sure we didn't have a senior
42:16vice president of product
42:17who were the assay leads
42:21I I'm not I'm not sure I think Steph's
42:24name was still there I'm working really
42:26closely with the assay teams at that
42:28point and there would have been others
42:31willison's role at fairness in 2013.
42:35you know again it's it's hard to
42:37pinpoint at specific points in time got
42:40involved in product development and I
42:43was was I believe at that point helping
42:46with the core product development
42:48initiatives
42:51I was in lab testing or in pathology
42:55I I don't believe he had prior
42:57experience in lab testing I I had
42:59understood that he
43:01ultimately met the requirements for
43:03someone to be a lab director
43:05what was his background
43:08um he had a
43:12I so this is my memory of it this could
43:15be incorrect I I understood that he had
43:16a predictive modeling I was talking
43:18about for
43:20modeling biology systems and
43:24um and then had had experience at
43:26theranos
43:27see you mentioned that you understood
43:29that he had the qualifications to be a
43:31lab director was he a lab director at
43:32fairness he was yeah what were the dates
43:36between which he was a the lab director
43:39I I don't know exactly certainly until
43:41we closed it
43:43I don't know when he became the lab
43:45director and what was your understanding
43:47as to how he was qualified to be lab
43:50director what what sorts of degrees did
43:52he have that made him qualified to to be
43:54in that role I I didn't know
43:56specifically I just knew that sunny and
43:58the team that had looked at that said
44:00that he was
44:04um
44:05and then you mentioned that you weren't
44:06sure who was in charge of the hardware
44:08or the manufacturing side at that time
44:11is that right yeah
44:13um was was it was he still around I
44:15don't know whether he'd started it at
44:17that point
44:18um
44:19I'm not sure
44:23was there a team that was in charge of
44:25putting the chemistries onto the
44:27hardware
44:30um I don't know
44:33who would have done that
44:35it would have been part of the clinical
44:37lab operation
44:38part of the CLIA lab operation is that
44:41right yeah I mean the product team
44:43because we were focused on lab develop
44:45tests was very tightly integrated with
44:47the clinical Lab at that point I don't
44:50know if they had a specific team that
44:52was it was focused on that okay and the
44:54person who's in charge of the clinical
44:56lab would have been yes
45:00how did she split up your
45:02responsibilities with Mr Belmonte
45:05and he was focused on operations
45:10um
45:10I was focused on
45:13our vision to the extent I was involved
45:15on the technology side and inventing and
45:17on ultimately some of the policy work
45:20like it worked to change the law in
45:22Arizona
45:24um and
45:26um and strategy
45:30were there particular areas that you
45:32managed versus areas that he managed
45:38um
45:39I I tried to stay involved with all of
45:43the creative aspects in terms of the the
45:45creative sort of invention side of the
45:47technology and the creative side of
45:50um
45:52The Way We Were
45:55trying to
45:58change the way people thought about
46:00their right to access lab results along
46:03the line of the Arizona law that we
46:07passed um he was focused on
46:11the clinical lab operations and the the
46:13internal operations of the business
46:16so if you look back at exhibit 194 and I
46:18know this is this is this is probably
46:20sometime in the later time period rather
46:22than 2015 but it looks at the number of
46:26um
46:27for instance the chief creative officer
46:29was reporting to you the marking off the
46:31chief marketing officer general counsel
46:33so there were a lot of corporate
46:34functions that reported to you at that
46:36time was that the same in 2013
46:40for instance the controller also was
46:42reporting to you at that time
46:45um I I don't know where on on the org
46:48chart they were we didn't have a general
46:50counsel in 2013 we didn't have any of
46:52these
46:54I I don't think we had any of these
46:56marketing people in-house at that time
46:57they may have been I think they joined
46:59after that
47:00um
47:03I I I'm not sure
47:06um
47:09who functionally was reporting to me in
47:12in 2013 on the product side
47:14okay and then you'll see that there look
47:16to be on the eight uh and I guess as
47:18well so these were all products you know
47:22when assays people were they all
47:24reporting to you back in 2013 as well
47:29um
47:31I I don't know I don't know
47:33I can't remember
47:36was there some
47:37um even if on paper they were reporting
47:40to you or Sonny balwani was there often
47:43some crossover between who people
47:45reported to whether it was you or to Mr
47:48balwani how did how did how did the
47:50reporting stretcher work
47:52we did not do a good job at maintaining
47:55org charts and
47:58I I think there was an understanding of
48:00how functionally we were operating I'm
48:03especially pre-2015
48:06which was essentially along the lines of
48:08of what I described
48:12okay so you mentioned before that Mr
48:14balwani was overseeing the lab and some
48:16of the product development particularly
48:18also on the software side
48:21you know what what were you overseeing
48:23in that process were you also involved
48:26in product development
48:29I I was the CEO of the company so I
48:33would engage with different teams my
48:36sort of involvement to the extent I was
48:39engaged on the product side was mostly
48:40on the creative parts and the invention
48:42sort of side or if we ran into
48:45challenges could we figure out a way to
48:47solve them technically from an invention
48:49standpoint
48:51um
48:51and and then
48:53and then on some of the other things
48:55that that I was alluding to from a
48:57strategy perspective
48:59where you get deprived of developments
49:01in the products area and in the clinical
49:04lab
49:05generally yes who would apprise you of
49:08those developments mostly sunny but
49:12occasionally others
49:14what about the company's Partnerships
49:18who was overseeing that process
49:21I'm I had a very close relationship with
49:24Steve bird at Safeway I'm Sonny managed
49:27the Walgreens relationship
49:29what about other business partners did
49:31you also similarly split up the other
49:34partners
49:36um I would have to think of who
49:37specifically to to think of who managed
49:40them those were to my memory the two
49:42major relationships that we were
49:43interfacing with at this period of time
49:47um what about the DOT
49:49Department of Defense
49:51um
49:52we had board members who were very
49:55engaged on in talking to people within
49:58DOD and then we had
50:02I was certainly in some of those
50:05meetings and um
50:07and then internally we had
50:10at least one project manager who was
50:13helping to coordinate uh Logistics and
50:16we we spent a lot of time developing
50:19technology there but we never really
50:21focused on
50:22getting those Systems off the ground
50:24because we were so focused on the retail
50:26deployments
50:29when you say that you were you never got
50:32those Systems off the ground what do you
50:34mean by that
50:35you were asking about managing
50:37Partnerships and it wasn't the same kind
50:39of you know active partnership that
50:41Walgreens was
50:44so
50:45for So when you say for this is for the
50:48Department of Defense projects yeah you
50:50weren't able to get the projects off the
50:51ground do you mean that you weren't able
50:53to deploy fairness services
50:55with the Department of Defense in the
50:58end we beside the um
51:01Institute for surgical research and a
51:04couple others we didn't fulfill the
51:06contract opportunities that we had
51:08why didn't you fulfill those contract
51:10opportunities
51:11we and we end up the bandwidth to do
51:14anything except for trying to make the
51:15retail relationship successful what were
51:17the other two divisions within the
51:20Department of Defense that you had
51:22contracts with that you were able to
51:23fulfill the sides The Institute for
51:25surgical research and from memory we did
51:29a little bit of testing with africom and
51:34we did a little bit
51:36associated with the NASA space program
51:39that someone else within DOD had
51:41referred us to and what happened to
51:44those relationships
51:46they were positive we we just didn't
51:48take any next steps with them
51:51based on focus and bandwidth internally
51:54did theranos receive any revenues from
51:56africom or NASA for those projects I
51:59don't believe from I I don't think so I
52:02don't know about Africa
52:05but you think for NASA Uranus didn't
52:07receive any remnies I don't think so
52:15okay I'm sorry you mentioned there and
52:17his board members were involved in
52:19facilitating your Communications with
52:21the dod who on theranosis board yeah I'm
52:25sorry meant to respond to her question
52:27about who was managing the relationships
52:29we
52:30um and made that coming in that context
52:32um
52:33who on our board George Schultz
52:36primarily
52:42mentioning the regulatory strategy for
52:45the company
52:47again in the 2013. I'm just talking
52:51about the 2013 time frame
52:54um we had we tried to hire some of the
52:57best outside lawyers I'm in the medical
53:00device and clinical lab space
53:03company was overseeing that process
53:08um you know I don't remember
53:09specifically in 2013 I
53:13believe
53:16I'm not sure I'm sure
53:18were you and Sonny balwani jointly
53:21involved in
53:22the regulatory strategy thinking about
53:25what approvals needed to be obtained and
53:27so forth
53:30yes absolutely
53:32what about the company's Financial
53:34condition
53:37who was overseeing for instance I think
53:40in 2015 it looks like it's reporting to
53:42you
53:43was she also reporting to you in 2013.
53:48um today since Sunny was at the company
53:51he primarily interfaced with her on
53:54just Financial operations and cash
53:57management I'm
54:01so as of 2015 inside the question was
54:042015. I'm actually talking about 2013 I
54:08wouldn't understand who was in charge of
54:10the financial conditions with the
54:12company making sure that the company was
54:14the operations were going smoothly that
54:16there was enough cash it would be signed
54:19by money yes
54:21were you at all involved in that process
54:23were you consulted
54:26I I may have been I mean I had very
54:28constant interactions with sunny
54:32what about human resources personal
54:35issues who was overseeing that
54:39um
54:40I I don't know when she joined for a
54:42period of time and she may have been
54:43there in 2013. did she have the
54:45authority to hire a fire personnel
54:50um
54:54she had the authority to make
54:58recommendations and I don't I believe
55:01there's a couple instances in which she
55:03hired directly but not regularly
55:08did she need to uh obtain approval from
55:11either you or Sonny balwani before she
55:13hired anyone that was certainly the
55:15expectation yeah
55:16and what about if she needed to fire
55:18anyone did those instructions come from
55:20you or Mr balani
55:22or the manager if there was a manager
55:26who felt that an employee had a
55:27performance issue
55:29were the managers at the company who are
55:31below you and Mr balwani were they did
55:34they have the authority to fire
55:36Personnel under them without running
55:37that by you and Mr balwani first
55:41you know I may be on the manufacturing
55:43side with assemblers but generally we
55:45would have wanted to have been involved
55:47in those conversations so generally you
55:49and Mr balabani would be involved in
55:50firing Personnel I think so yeah
55:54how would you and Sonny balwani
55:56communicate with respect to your work
55:59I just don't understand just the
56:01question of communication did you
56:04text each other did you
56:07call each other on the phone what did
56:08you do
56:10ugly
56:11all of the above and we we texted we
56:16um
56:16we're working in a very open space
56:19format our offices we're near each other
56:20and we would talk
56:24were there times when you would meet
56:25face to face
56:26and were there regular meetings when you
56:29did
56:31yes we met face to face a lot were there
56:34regular meetings that were set up maybe
56:36weekly or monthly
56:38I don't think they were scheduled like
56:39that and it was very sort of dynamic
56:46how did how did Mr balwani keep you
56:48prized at the areas of the business that
56:50he was responsible for
56:54we we would talk but as you
56:58um
56:59we operated as peers and so he would run
57:02the areas that he was operating and
57:05um and talk to me about the things that
57:07he thought were relevant
57:10so were you consulted about decisions he
57:13would be making on the product
57:13development and clinical lab side
57:18depends on what they were on some of
57:21them yes
57:22did you expect him to run those
57:24decisions by you
57:25I expected him to share with me anything
57:27that would be material to making sure we
57:30were properly executing on our plans
57:32were there areas in which he disagreed
57:35yes what were those areas
57:39we disagreed all the time about a lot of
57:42things
57:43and we're
57:45we're very different leadership styles
57:50uh what would and how would you resolve
57:52that discussion if you disagreed on an
57:54issue
57:56depends on what the issue was I I would
57:58generally defer to him because he was
58:00there as our president and CEO
58:02were there areas that he would defer to
58:04you
58:07I'm sure there were um I I don't I would
58:10need to think specifically about you
58:12know a specific issue to better answer
58:14the question
58:16so I think we mentioned a number of of
58:18different areas of the company but for
58:20instance on business Partnerships you
58:22know who would be the one who would make
58:24the ultimate decision if the two of you
58:25disagreed
58:28if it pertained to Walgreens it was
58:29sunny if it pertained a safe way I
58:37probably me but it depends on what the
58:39issue was if it had to do with something
58:41that was in a functional area that he
58:42was managing I would defer to him
58:45uh what about the Department of Defense
58:50I think it would depend on on what it
58:52was again that was a different type of
58:54relationship than the active commercial
58:57Partnerships that we deployed
58:59what about your regulatory strategy with
59:01either FDA or the center for Medicare
59:04and Medicaid services
59:06I'm in general we would defer to outside
59:09Council on that
59:11were there times when you would decide
59:14that you wouldn't follow council's
59:16advice
59:18not not that I well I'm not during that
59:21period
59:23what about your Finance Financial
59:25condition of the company
59:27were there any who would be the ultimate
59:30decision maker with respect to the
59:32company's operational and financial
59:34progress
59:37I mean in general so anyways
59:48it sounds like you had a very Dynamic
59:50relationship and you were you would talk
59:52with Mr balwani a lot about different
59:54areas that you were working on were
59:56there times when you would also
59:58draft email Communications third parties
1:00:01for instance I think you said that you
1:00:03were in charge of the Safeway
1:00:04relationship that Mr balwani would then
1:00:06edit and revise before sending out yes
1:00:08and did that happen in the other way
1:00:11around where he would be drafting emails
1:00:13to third parties that you would also
1:00:15revise for him before sending out
1:00:19trying to I'm trying to think of a
1:00:22specific instance I mean art
1:00:24our Dynamic was that I generally
1:00:27sought his advice on how to handle
1:00:30things
1:00:32but were there instances in which he
1:00:33would draft emails which he would then
1:00:35review and edit and approve before he
1:00:38sent them out I wouldn't be surprised if
1:00:41there were I can't remember a specific
1:00:43instance sitting here but
1:00:46it was it was as you started Dynamic
1:00:48interaction
1:00:49we're on fairness's electronic system
1:00:52did you keep your working files
1:00:56um
1:00:57what do you mean by that so is there a
1:01:01document management system at fairness
1:01:04there is I mean there's shared drives
1:01:06that different people have access to as
1:01:09well as local
1:01:11and document files for a given person's
1:01:14computer okay was there a particular
1:01:16folder on that share drive that you
1:01:19would use to keep for instance notes for
1:01:21meetings or
1:01:23draft documents that you were working on
1:01:27I generally kept my documents in my
1:01:30document folder and my assistants also
1:01:33had a drive that they would put
1:01:34documents on
1:01:36so you had a document folder was this on
1:01:38your hard drive or was it on the share
1:01:40Drive
1:01:42um
1:01:42it was specific to my computer I think
1:01:45it was technically hosted on a on a
1:01:48network but it was it was only I had
1:01:51access to it what did you call that
1:01:53folder my documents it was called my
1:01:55documents yeah okay and and you said you
1:01:58think it might have been backed up by
1:02:00the system is that what you mean I
1:02:01expect it would have been yeah
1:02:04um are you aware of a folder called the
1:02:05CEO folder
1:02:07I generally I think so and is that the
1:02:11other folder that you're talking about
1:02:12which your assistance would put
1:02:13documents into I think so
1:02:16would you ever edit documents in that
1:02:18folder
1:02:19I don't think so
1:02:21these were this was this folder was only
1:02:23for your assistants and others to put
1:02:25documents into yes and would you access
1:02:28the documents in that folder
1:02:30I I could access it I don't know that I
1:02:32ever have I guess what is the purpose of
1:02:34that CEO folder
1:02:37um if we had documents from a meeting
1:02:40and they were trying to scan them
1:02:41because they were going to get rid of a
1:02:42hard copy they would put them in that
1:02:44folder or other documents that they
1:02:47felt should go in there they had control
1:02:50over it and did Sonny balwani also have
1:02:53a working folder as well
1:02:55I believe so yes what folder was that
1:02:58called I don't know are you aware of the
1:03:01folder called the 300 folder I am what
1:03:04is that holder
1:03:06uh I think that is where he kept
1:03:10um
1:03:13strategic documents and I think he had
1:03:17some of his models in there too
1:03:19you have access to
1:03:21system I did and did you go in from time
1:03:23to time to review or edit those
1:03:25documents
1:03:27I don't think I have
1:03:30did you ever review documents in that
1:03:31folder
1:03:33he would show me documents from that
1:03:35folder before certain meetings
1:03:37um
1:03:39when you say he would show you certain
1:03:41documents from the folder do you mean
1:03:43that he would print them out and show
1:03:44them to you no I would sit in front of
1:03:46his computer and he would open it yeah
1:03:47from that paper would you ever sit at
1:03:49your own computer and review files on
1:03:52his in his 300 folder
1:03:56I mean it's possible I can't remember
1:03:57that but it's possible
1:04:00but you don't think that you might have
1:04:01edited any of his files from that folder
1:04:04I don't think so
1:04:12so I wanted to talk about the clinical
1:04:14lab for a minute so you mentioned was
1:04:17the lab director in 2013. was there
1:04:20somebody who was in charge of the
1:04:22clinical lab before he came on board
1:04:25yes he was at
1:04:27um
1:04:28I believe it was there may have been
1:04:31someone in between them but
1:04:34at least what was the clinical lab doing
1:04:36before it was certified
1:04:40um before it was certified
1:04:43before it obtained CLIA certification
1:04:46nothing
1:04:47okay so it was just was it just
1:04:49constructed was it processing any blood
1:04:53samples
1:04:54so the the Clio certification was in
1:04:572011.
1:04:58and it didn't exist before it obtained
1:05:01CLIA certification post 2011.
1:05:05um
1:05:05I believe there was some
1:05:08what we call reference testing which is
1:05:10traditional testing for Safeway while we
1:05:12were working to refine our operational
1:05:14procedures and then otherwise we were
1:05:18trying to put good systems in place to
1:05:20launch the lab
1:05:22so you mentioned that you were doing
1:05:24some reference testing for Safeway what
1:05:26do you mean by reference testing they
1:05:28had a Wellness Center at their
1:05:33headquarters and they asked us to be the
1:05:37place that would process the samples
1:05:39that were drawn traditionally and we
1:05:42would either process them at our lab or
1:05:44send them out to a reference lab and
1:05:46report them back to the ordering
1:05:48practitioner there okay and so you
1:05:51mentioned that um
1:05:53the blood draws would be done
1:05:55traditionally what do you mean by
1:05:56traditionally
1:05:58a venipuncture on commercially available
1:06:00machines
1:06:02so the blood would be drawn via
1:06:04venipuncture and the blood samples would
1:06:06then be tested on third party
1:06:08commercially available devices or a
1:06:11reference lab yes
1:06:15what is a reference lab
1:06:17it's a place where you can send samples
1:06:20to have analyzed by a third-party lab
1:06:22and they will report them back to your
1:06:25lab and you pass those results on to the
1:06:28ordering practitioner
1:06:33who is again does he have a role at the
1:06:36company as well he does what was his
1:06:38role in 2013.
1:06:41I I don't know in 2013 I think it was in
1:06:44product management
1:06:45um but I'm not I'm not sure
1:06:48what did that mean product management
1:06:52um I believe
1:06:54his role
1:06:57was primarily focused on managing
1:06:59business relationships
1:07:02um
1:07:04with with people who are important to
1:07:06the company but but I'm not I'm not
1:07:08completely clear and the product
1:07:11managers worked on sort of important
1:07:14projects for the company and there was a
1:07:16wide range of projects that they
1:07:18they worked on
1:07:19who did court to in 2013. he reported to
1:07:22Sunny
1:07:23and you mentioned there were a number of
1:07:25project managers these were project
1:07:27managers that reported to
1:07:29they reported for a period of time I
1:07:31don't know when and then directly to
1:07:32Sunny after that
1:07:34who were these project managers
1:07:38I'm not going to get them all by name
1:07:41at what period of time in 2013.
1:07:45I believe was there at the time
1:07:49there were others I I don't I don't
1:07:52remember them all by name
1:07:54just wanted to go through each of the
1:07:56people that you just named and just
1:07:58understand what they were responsible
1:07:59for so I think you meant first so what
1:08:02was his role
1:08:04so I outside of knowing that Sunny was
1:08:07using them to help manage key projects I
1:08:10I don't know specifically what they were
1:08:12doing and I I believe they were
1:08:15generally involved in retail operations
1:08:17and management of of relationships but I
1:08:21I wouldn't be able to say that it was
1:08:23doing this and and Sonny was doing that
1:08:25were you familiar with what he's doing
1:08:28he worked closely with me in supporting
1:08:30meetings that I was doing and
1:08:33Communications
1:08:35okay what kind of meetings was he
1:08:36involved in
1:08:38a broad range of meetings I'm
1:08:43could have been with with partners with
1:08:45investors with
1:08:50with others
1:08:53I don't know if he was working closely
1:08:55with me yet in 2013 he was before he
1:08:59left
1:09:00what about
1:09:02again I believe operational projects
1:09:05related to the retail rollout
1:09:08you mentioned well this is his role I I
1:09:10believe same thing
1:09:12and yep
1:09:15he was also an operations person
1:09:17I I don't know what he was doing in
1:09:182013. what about uh is he also a project
1:09:22manager or was he also a project manager
1:09:24in 2013.
1:09:26I don't know that he was I
1:09:28he's working within the software
1:09:30organization and I I don't know exactly
1:09:32what he was doing Within 2013. and when
1:09:35you say software organization what do
1:09:37you mean
1:09:39um
1:09:39we had a team that we called the
1:09:41software team and he was part of that
1:09:44team
1:09:45and who did he report to
1:09:48up to Sunny I don't know if you directly
1:09:50reported to Sunny
1:09:52uh did did all of these project managers
1:09:54have a private a prior relationship with
1:09:58not all of them some of the ones that I
1:10:00just listed did okay what was that prior
1:10:02relationship
1:10:04were you involved in hiring all of them
1:10:06I was that group yes that group yes when
1:10:10did you hire them
1:10:12um
1:10:14I I don't know if I think
1:10:192011 maybe 2012 I'm not quite sure why
1:10:22did you hire them
1:10:24because we were working
1:10:2724 7 almost trying to
1:10:30do something good and we needed people
1:10:33who wanted to work that hard and put
1:10:34their heart and soul into it
1:10:37did you use the project managers as sort
1:10:40of a liaison between you and sunny
1:10:42belwani and other employees at the
1:10:44company
1:10:46uh no not to my knowledge
1:10:48were there specific areas that the
1:10:51project managers would be overseeing
1:10:53sort of a way for you and Sonny bellwani
1:10:56to delegate particular responsibilities
1:10:58to another group of people
1:11:00I I don't know specifically how he was
1:11:03using them
1:11:04um I I don't know
1:11:08how did you use them
1:11:10you mentioned you had a relationship
1:11:12with yeah I used him generally for
1:11:15follow-ups
1:11:16um
1:11:18foreign
1:11:20what do you mean by used and generally
1:11:21for follow-ups
1:11:24um in in a support role so if we had a
1:11:27meeting and setting things up for the
1:11:29meeting making sure if we needed to send
1:11:31a note to follow up on the meeting the
1:11:32note was sent those those types of
1:11:34things
1:11:36was he also having Communications
1:11:38directly with for instance some of your
1:11:41business partners or even the Department
1:11:43of Defense I think he did yeah okay what
1:11:46and what kind of communications was he
1:11:48having with them
1:11:50I mean
1:11:52it was many years so I'm sure it's a
1:11:54broad range
1:11:55um
1:11:56generally coordination with different
1:11:59people who we were interfacing with
1:12:01So when you say coordination do you mean
1:12:03coordination of meetings
1:12:06coordination of I mean it could be
1:12:09meetings could be discussions could be
1:12:11follow-up could be a response to a
1:12:12request
1:12:14would he run every time that he was
1:12:16communicating with them would you expect
1:12:18that he would run that by you first
1:12:20I I wanted generally for him to do that
1:12:23he did not always do that were there
1:12:25times though when he would send you for
1:12:27instance draft emails that he was
1:12:29planning to send out to a business
1:12:31partner that you would then review and
1:12:33edit and send back to him
1:12:35I'm sure there were yeah
1:12:39I've been going a little over an hour
1:12:40and a course we take a short break
1:12:42um let's take a look
1:12:46I just have a few more questions and
1:12:48then we can take a break okay so
1:12:53she have regular meetings with the
1:12:55project managers
1:12:58um I did not
1:13:00to my memory do you know Sunny balwani
1:13:02did
1:13:04I would expect that he would have I I
1:13:06don't know whether it was meetings
1:13:10that were regularly scheduled
1:13:23okay we can take a quick right now okay
1:13:26this concludes Media One of Elizabeth
1:13:28Holmes were off the Record at 10 16.
1:13:31okay let's just take a five minute break

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