Technology

Defense Lashes Out at Key Witness in Elizabeth Holmes Fraud Trial

Yichuan Cao | NurPhoto | Getty Images
  • Investor Alan Eisenman, a key government witness, violated court rules by contacting prosecutors regarding his testimony.
  • A defense attorney for Elizabeth Holmes grilled Eisenman in a fiery cross examination.
  • Jurors have heard testimony from 24 government witnesses over 11 weeks.

SAN JOSE, CALIF. -- A defense attorney for Theranos CEO Elizabeth Holmes lashed out at a key government witness for violating court rules by contacting prosecutors about his testimony. Holmes is fighting 12 charges, including ten counts of wire fraud and two counts of conspiracy to commit wire fraud.

During a contentious cross examination on Monday, attorney Kevin Downey, part of Holmes' defense team, revealed that Alan Eisenman, a former Theranos investor from Texas, sent an email to the prosecution team after he finished his direct examination, despite being told not to discuss the trial with anyone.

Eisenman repeatedly denied that he had discussed the substance of his testimony, however.

"How long did it take you to violate the direction given to you?" asked Kevin Downey. "Wasn't it less than about 15 hours?" 

"I don't recall," Eisenman said, adding he was "pretty tired."

Following his email, Adelaida Hernandez, an FBI special agent for the government, called Eisenman and told him "do not communicate with the government," according to Downey.

On Friday, Eisenman once again emailed the prosecution team. This time John Bostic, an assistant U.S. attorney, called Eisenman.

"They told you 'do not communicate with us again' and that was the third time that the government had told you do not communicate with us about the testimony going on inside Judge Davila's courtroom," Downey said.

Eisenman said he didn't think his communication in his last email to prosecutors was substantive or relevant to the testimony. He recalled it was about travel arrangements.

"Is it up to you whether this is relevant?" Downey asked.

"I'm a smart guy, this had nothing to do with the case," Eisenman said.

"Did they agree with your smart judgment?" Downey asked, referring to prosecutors.

In another effort to cast the witness as being biased, Downey pointed to a December 2018 email Eisenman wrote to Hernandez. The email began: "Hi Addy." Eisenman ended the email by writing: "You know that I am a faithful part of your team, and will do all that I can to help your case."

Downey asked Eisenman if this email was an accurate statement about his relationship with prosecutors.

"I think there was business fraud," Eisenman said. "I think I was lied to and taken advantage of. I think there was a lot of abuse through the years and I'll do what I can to tell my story. And that we have the same outcome, that justice be served."

Eisenman, a retired money manager and financial planner, took the stand last week as the government's 24th witness in its case against Holmes. He and his family invested more than $1 million in to the blood-testing startup.

Eisenman told jurors many factors led to his decision to invest including financial projections from Holmes, he was under the impression Theranos had several pharmaceutical contracts and the fact that Oracle's Larry Ellison was an investor and board member.

He testified that he grew frustrated with Holmes and company president Ramesh "Sunny" Balwani after repeatedly trying unsuccessfully to get straight answers about the blood-testing company.

Before Eisenman testified last Wednesday, defense attorneys and prosecutors discussed a purported statement he made "upon entering the courtroom" about wanting Holmes to go to prison. Prosecutors told the judge that they would not ask him questions about his reported statement.

Eisenman did not make any sort of comment about Holmes' potential punishment while on the stand.

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