The writer of “Bad Blood” has not finished telling the Theranos story.
Three years after his bestseller was published, John Carreyrou is releasing a new podcast to uncover the final chapter of former Theranos CEO Elizabeth Holmes. “Bad Blood: The Final Chapter” follows the upcoming trial against Holmes.
In an interview with CNBC, Carreyrou shared his bold predictions about her criminal fraud trial due to begin in August after several delays due to the coronavirus pandemic and her unexpected pregnancy. Despite the postponements, Carreyrou predicts Holmes will be convicted of wire fraud and said a guilty verdict in her trial will be a “big shot across the bow for Silicon Valley entrepreneurs”.
“The message will be that you can’t really do what you want, you can’t completely ignore rules and regulations. You can’t shake your nose at regulators and authorities,” Carreyrou said.
He warns that a not guilty verdict will set a dangerous precedent among startup CEOs. “Young entrepreneurs will say, ‘Look what Elizabeth Holmes got away with and she didn’t go to jail for it.'” Carreyrou adds, “In this case, it takes a guilty verdict to correct course.”
Holmes and Ramesh “Sunny” Balwani ran the now defunct start-up Theranos together as CEO and President – and at times also as girlfriend and boyfriend.
The two are facing separate criminal jury trials over allegations they lied to patients and doctors while pushing investors for hundreds of millions of dollars. Holmes and Balwani have both pleaded not guilty.
Carreyrou tells CNBC that a large part of Holmes’ defense strategy could be blaming Balwani. He predicts that Holmes will take a stand and tell the jury that Balwani “kept her in his psychological grip, that he was an abusive friend”.
CNBC reached out to Holmes and Balwani attorneys. They did not respond to calls for comment.
Holmes plans to call a psychologist who specializes in relationship trauma as a witness. Carreyrou, who has spent years reporting on Holmes and the events in Theranos, says he is not buying the defense.
“Based on all of the interviews I did for my book and other interviews I did for the podcast, it’s clear that they ran this company and allegedly committed this fraud together as a couple,” he said.
“If they couldn’t agree, she had the last word,” said Carreyrou. “That’s why I find it hard to believe that she was under his psychological grip and had no will of her own.”
Watch the video to learn more from Carreyrou about his trial predictions, new evidence he’s received, and his upcoming podcast.