Thread by @doratki

Good morning from a rainy San Jose! I'm in the overflow courtroom for Elizabeth Holmes' criminal fraud trial. It looks like no time is being wasted today. Judge Ed Davila is on the bench & the parties are arguing over limiting ex-Theranos lab director Dr. Kingshuk Das' testimony.

Holmes has unsuccessfully fought to exclude Das from trial, arguing that the government waited too long to disclose him as a witness. Here's my prior coverage on that pretrial fight ICYMI. law360.com/articles/14148…

Judge Davila notes Das won't be testifying as an expert — b/c the gov't missed the deadline to disclose him as an expert — but he can testify on certain topics if a foundation is laid during his exam. Judge (a creature of habit) says, "I think it’s a wait and see."

Holmes' defense attorney Lance Wade and prosecutor Robert Leach are arguing over whether CLIA lab owners/operators can be held liable for CLIA violations. Leach says the defense "wants to suggest the buck stops with the lab director and nobody else," but that's not true.

Leach agrees that he won't suggest "in any way" that Holmes aided and abetted a CLIA violation, b/c that's not a charge the DOJ asserted, but he does want to mention during trial that lab owners like Holmes could face sanctions for lab violations.

Holmes' counsel also wants the judge to exclude portions of the 121-page CMS report on Theranos from trial. Judge Davila notes that the jury is coming in at 9:30 a.m. so the attorneys will probably have to continue the debate over the report later.

Holmes' counsel notes that her text messages w/ Sunny Balwani that she was hoping and praying that the CMS inspection would go well, doesn't show that the lab staff reported to her or that she gave them specific direction.

The judge says they're going to call in the jury, but they need to "reboot" the computer systems because the court had technical issues this morning. The reboot will take about 10 mins. We'll be going to 4 p.m. today.

The court's technical issues seem to be a bigger deal than just a mere "reboot." Court staff is considering projecting exhibits onto a screen for the jury to view.

After about an hour, the attorneys and court staff got a projection hooked up to display the exhibits on a screen across from the jury box. The judge is currently inspecting it and chit-chatting with counsel.

Staff turned off the courtroom lights so that the jury can see text projected onto the screen. They also put a lamp in the witness box. The judge is moving the lamp around and considering pros/cons of its position. (Did I mention we're in Silicon Valley?)

The jury is back. The judge says they've had technical issues and the video display system isn't working, hence the delay, the projection screen and the lamp. The judge had staff turn off the lights and asks if jurors can read the exhibits. One juror needed to get his glasses.

The juror returned w/ his glasses, and they all can see the exhibit, so trial is proceeding. The judge apologizes and notes the court had water outages a couple weeks ago. "I'm very embarrassed that our courtroom has had these problems... This is not supposed to happen."

Dr. Lynette Sawyer, who served as Theranos' co-laboratory director from late 2014 to June 2015 alongside Sunil Dhawan, is back on the stand. Judge Davila tells Sawyer he's leaving the "charming lamp" by her so that she can see.

Holmes' counsel Lance Wade is up on cross, getting Sawyer to acknowledge that she primarily interacted with Sunny Balwani at Theranos and her services were limited under her employment contract.

Judge Ed Davila interrupts cross to ask the jury if they can all see the witness, because he notes it's an important part of trial. They agree they can see her. (I think everyone can see her because there's a lamp about a foot from her face.)

Wade points out that Theranos also hired as a consultant Jerry Hurst, who consulted for Theranos competitor Quest Diagnostics and served as a DOJ expert. Wade noted that Hurst also worked for the state of Calif. conducting CLIA inspections.

Sawyer says Sunny Balwani was "pushy" when she quit, b/c "I just believe that he was hoping that I would stay longer." In an April 2015 email, Hurst told Balwani that Sawyer planned to end her contract in May. Balwani said June would be "ideal," so she agreed to stay thru June.

Sawyer says she doesn't know what Theranos' "nanotainer" is and never asked Balwani any questions about it. A nanotainer was Theranos' proprietary name for a tiny vial that held blood for its tests.

Holmes' counsel asks Sawyer if she was aware that Hurst was doing mock CLIA audits to prepare Theranos for inspections. She says she was not aware of that.

Holmes' counsel wrapped cross. Prosecutor points to Sawyer's April 2015 email about quitting. He asks Sawyer that she started at Theranos in December 2014 and "by April 2015 you want out?" "Yes," she replies.

Sawyer says she only signed a few Theranos validation reports related to antibiotics testing of bacteria and a "phlebotomist SOP" on fingerstick tests, but no validation reports related to Theranos' Edison devices.

The parties wrapped with Sawyer. We're going to take a 35 minute lunch break before the next witness, who is expected to be Dr. Kingshuk Das. Brb!

We're back, and the government called Kingshuk Das to the stand. Das is a medical doctor and he worked as Theranos' lab director for 2.5 years, starting in March 2016 until 2018, around the time the company dissolved amid regulatory and public scrutiny.

Prosecutor Robert Leach points to federal CLIA regulations that say CMS can revoke or suspend a lab owner's CLIA lab certificate if violations are found.

Das says that when he started working at Theranos, he thought that Theranos wasn't performing blood tests on its Edison or MiniLab devices, and he didn't think the company was using non-FDA approved machines to test fingerstick blood samples.

Das says he had minimal interaction with Sunny Balwani, because Balwani left Theranos soon after Das began working full time at Theranos. He said initially he primarily did paperwork, responding to statements of deficiencies that CMS issued after an audit of Theranos' lab.

Das says he reported to Elizabeth Holmes and he responded to CMS's 121-page statement of deficiencies. He says he had many conversations with Holmes and traveled with Holmes to Washington DC to speak to CMS officials about its report.

A cover letter came with the CMS report. The letter - dated Jan 25, 2016 - was addressed to Theranos' prior lab director, Sunil Dhawan, and says after a Nov 2015 inspection, CMS concluded Theranos' lab deficiencies "pose immediate jeopardy to patient health and safety."

Testimony is slow, b/c they're having technical issues with redactions in the CMS report. Holmes' counsel also has raised multiple objections, but the judge overruled them and noted the evidence can speak to Holmes' state of mind, but not the truth of the matter asserted.

Prosecutor points to CMS findings. Das agrees that quality control tests of multiple Theranos assays on the Edison devices violated the "2SD rule," which is a Westgard rule. (Ex-Theranos lab director Adam Rosendorff testified Theranos never adopted Westguard rules into policy.)

Das says there was an instance where Theranos tests reported prostate-specific antigens in women who had been tested, but he noted that PSA is only found in men. Holmes told him it may be due to a breast cancer in women, but he says her explanation "seemed implausible."

Prosecutor points to Das' response to CMS that Theranos had a "global and long term failure of the quality control program" of its instrument and he had Theranos voided all patient test results "out of an abundance of caution."

Das said "these instruments were apparently mal-performing from the very beginning," but Holmes offered an "alternative explanation" that it was not an "instrument failure per se, but a failure of quality control and quality assurance program around it." He disagreed.

Das noted that Theranos' validation data "had no bearing on the quality control or quality assurance program," so it couldn't be just a QC problem. "I found these instruments to be unsuitable for clinical use," he said. Trial is taking a 30 minute break. BRB!

We're back! Only 30 minutes left of testimony for today. Prosecutor Robert Leach is going through the CMS's Theranos report, which concluded Theranos assays failed precision tests, among other things.

Das testifies that he found instances of quality control assay failures at Theranos when the patient test results were still reported to patients. CMS reported the same findings.

Prosecutors wrapped Das' direct exam with him testifying that he "voided" all 50k-60k tests that were ever done in Theranos' CLIA lab and testing in the lab never resumed. He admits that Theranos never notified patients that test results were voided.

Holmes' counsel Lance Wade is up on cross. He begins by pointing out there was a period of time between when Das started part time in Dec 2015 and when he received the CMS report in Jan 2016. During that time, Theranos was improving its lab practices, Wade says. Das agrees.

Das agrees that Theranos' lab team had significant expertise and were working hard, diligently and "in good faith" to improve Theranos' lab practices.

Das agrees that Theranos' lab team wanted to respond "quickly and efficiently" to CMS's statement of deficiencies. With that, trial is breaking for the evening. Das will be back on the stand tmr morning, the judge notes, & hopefully w/ the court's technical issues cleared up. ✌️

Theranos' 4th and final lab director testified in Elizabeth Holmes trial today that within weeks of being hired, he discovered Theranos had "global" quality control problems and found the various explanations Holmes offered "implausible." My daily recap! law360.com/articles/14391…