Lisa Peterson — Cross/Redirect/Recross (Continued)
1,059 linesJUDGE DAVILA: AND THAT WOULD GIVE US THE ENTIRETY OF THAT MONDAY IF I CAN DO THAT. WE'LL FREE UP THAT AFTERNOON FOR US. I HOPE THAT WORKS FOR THE JURY. I WANT TO ASK ANOTHER QUESTION REGARDING AN EMAIL THAT WAS PROVIDED TO COUNSEL AT COUNSEL'S REQUEST LAST WEEK. I THINK, MR. DOWNEY, YOU MADE A REQUEST ABOUT RECEIVING A COPY OF AN EMAIL. I THINK WE PROVIDED IT TO THE GOVERNMENT AND TO YOU. I JUST WANT TO ASK NOW, IS THERE ANYTHING YOU, MR. DOWNEY, YOU WOULD LIKE TO DO WITH THE COURT OR ANYTHING YOU WANT TO DO IN REGARDS TO THAT DOCUMENT THAT YOU RECEIVED?
MR. DOWNEY: NO, YOUR HONOR, NOT AT THIS TIME. WE'RE MINDFUL OF THE ISSUES THAT THE COURT HAS ADDRESSED SEVERAL TIMES BEFORE WITH NOISE AND DISTRACTION, AND WE'LL KEEP MONITORING IT AS WELL.
JUDGE DAVILA: OKAY. MR. SCHENK, ANYTHING?
MR. SCHENK: NO. NOTHING FURTHER. THANK YOU.
JUDGE DAVILA: THANK YOU. SO IF THE PARTIES WANT TO RAISE ANYTHING WITH THE COURT, OR YOU FEEL THAT THINGS DEVELOP TO A POINT WHERE IT'S IMPAIRING YOUR ABILITY TO PRESENT YOUR CASE, YOU SHOULD LET ME KNOW. YOU HAVE AN OPEN INVITATION TO LET ME KNOW AND THEN WE CAN TAKE THAT MATTER UP. OTHERWISE I'LL ASSUME THAT IT'S A DISTRACTION, BUT NOT TO THE POINT OF ANY NECESSARY COURT INTERVENTION. IS THAT FAIR?
MR. SCHENK: YES. THANK YOU.
MR. DOWNEY: YES, YOUR HONOR.
JUDGE DAVILA: ALL RIGHT. THANK YOU. ANYTHING ELSE WE SHOULD TAKE UP BEFORE WE -- BEFORE I STEP DOWN AND MAYBE WE GET STARTED ON TIME?
MR. SCHENK: NOTHING FURTHER.
MR. DOWNEY: NOTHING FROM US, YOUR HONOR.
JUDGE DAVILA: OKAY. GREAT. THANK YOU VERY MUCH.
(RECESS FROM 8:54 A.M. UNTIL 9:11 A.M.)
(JURY IN AT 9:11 A.M.)
JUDGE DAVILA: THANK YOU. WE'RE BACK ON THE RECORD IN THE HOLMES MATTER. ALL COUNSEL ARE PRESENT. MS. HOLMES IS PRESENT. OUR JURY AND ALTERNATES ARE PRESENT. IT'S NICE TO SEE YOU AGAIN. I HOPE YOU ENJOYED THE TIME OFF, THE LONG TIME OFF. BEFORE WE BEGIN, LET ME ASK YOU THAT QUESTION, I KNOW YOU HAVEN'T FORGOTTEN IT. DURING THE BREAK, HAVE ANY OF YOU HAD OCCASION TO EITHER SEE, HEAR, READ, OR HAVE DISCUSSIONS WITH ANYONE ABOUT ANYTHING TO DO WITH THIS CASE, THAT IS, BY READING, LISTENING, OR CONVERSATION WITH ANOTHER PERSON? IF SO, PLEASE RAISE YOUR HAND. I SEE NO HANDS. THANK YOU AGAIN FOR YOUR CONTINUED VIGILANCE AND ADHERENCE TO MY REQUEST. I APPRECIATE THAT, AND I KNOW THE LAWYERS DO AS WELL. SO THANK YOU FOR THAT. BEFORE WE BEGIN, I DO WANT TO TAKE UP WHAT HAS BEEN A DISCUSSION WE'VE HAD BEFORE, AND THAT'S ABOUT NOISE IN THE COURTROOM.
WE DID HAVE A HEARING THIS MORNING WHERE I NEEDED SOME ASSISTANCE FROM THE LAWYERS AND PARTIES OUTSIDE OF THE PRESENCE OF THE JURY, AND DURING THAT PROCEEDING, THERE WAS -- I JUST WANT TO SAY IT WAS AUDIBLE, THERE WAS TYPING THAT WAS AUDIBLE TO THE COURT, PERHAPS TO COUNSEL AT THEIR TABLES. I'M NOT GOING TO ASK THEM THAT. BUT IT WAS CERTAINLY AUDIBLE TO THE COURT. I HAVE MADE COMMENTS BEFORE ABOUT THIS, THAT UNNECESSARY DISTRACTIONS IN THE COURTROOM DIMINISH THE QUALITY OF THE PROCEEDINGS AND COULD POTENTIALLY INTERFERE WITH THE PROCEEDINGS. I THINK I SAID LAST WEEK THAT IF THAT PERSISTS, THERE ARE GOING TO BE -- I'M GOING TO BE FORCED, CANDIDLY, TO ASK ANYONE WITH A KEYBOARD WHO IS DOING TYPING TO GO TO OUR OVERFLOW ROOM SO YOU CAN, THOSE WHO USE THOSE DEVICES CAN PARTICIPATE IN THE TRIAL, OBSERVE THE TRIAL, AND CONTINUE TO PARTICIPATE IN THE TRIAL IN THAT ROOM SUCH THAT THERE'S NO DISTRACTION IN THIS ROOM.
I SAY THAT ON BEHALF OF ALL OF THE PARTIES HERE, AS WELL AS OUR JURY WHO ARE -- AS THOSE WHO KNOW HAVE BEEN ATTENTIVE THROUGHOUT THE PROCEEDINGS, AND I DO NOT WANT ANYTHING TO INTERFERE WITH THE EXAMINATION OF THE WITNESSES OR THE JURORS' ABILITY TO ACCURATELY FOLLOW THE PROCEEDINGS. SO AGAIN, I'M REACHING OUT TO THOSE OF YOU, OUR FRIENDS IN THE AUDIENCE WHO HAVE KEYBOARDS, IF YOU WOULD PLEASE, PLEASE MONITOR YOUR TYPING IF YOU CAN. AND IF YOU CAN'T, I INVITE YOU TO GO TO THE OVERFLOW ROOM AND YOU CAN TYPE THERE AS YOU WISH WITHOUT ANY FEAR OF THE NOISE IMPAIRING THE PROCEEDINGS. I'M GOING TO ASK YOU TO SELF-POLICE THAT. WE HAVE A MEMBER FROM THE SHERIFF'S OFFICE, EXCUSE ME, THE MARSHAL'S OFFICE HERE. I'M GOING TO CONTINUE TO BE VIGILANT ON THAT SUCH THAT THE PROCEEDINGS ARE NOT DISRUPTED. AND I DO INDICATE THAT I COMPLETELY RESPECT THE PRESS AND WHOEVER ELSE IS IN HERE, THE PUBLIC, AND TYPING, MAKING NOTES. I DON'T WANT TO DISRUPT YOUR ABILITY TO CAPTURE YOUR WORK AND DO YOUR WORK. BUT I HOPE YOU WOULD BE EXPRESSING RECIPROCITY TO US, AND ME, TO ALLOW US TO DO THE WORK THAT WE NEED TO DO. SO THANK YOU VERY MUCH. THANKS FOR THE BREAK. THANK YOU FOR LETTING ME COMMENT ON THAT. WE DO HAVE A WITNESS THAT NEEDS TO RETURN I THINK. IS THAT MS. PETERSON?
MR. LEACH: YES, YOUR HONOR.
JUDGE DAVILA: GOOD MORNING, MS. PETERSON.
LISA PETERSON: GOOD MORNING.
JUDGE DAVILA: PLEASE MAKE YOURSELF COMFORTABLE AGAIN. FEEL FREE TO REMOVE YOUR MASK. THERE IS FRESH WATER THERE FOR YOUR REFRESHMENT IF YOU WOULD LIKE TO TAKE ADVANTAGE OF IT. MAKE YOURSELF COMFORTABLE. WHEN YOU ARE COMFORTABLE, I'LL ASK YOU TO PLEASE STATE YOUR NAME AGAIN, PLEASE.
LISA PETERSON: LISA PETERSON.
JUDGE DAVILA: THANK YOU. AND I'LL REMIND YOU YOU ARE STILL UNDER OATH.
LISA PETERSON: YES.
JUDGE DAVILA: THANK YOU.
(GOVERNMENT'S WITNESS, LISA PETERSON, WAS PREVIOUSLY SWORN.)
JUDGE DAVILA: YES, THANK YOU.
CROSS-EXAMINATION (RESUMED) BY MR. WADE:
LISA PETERSON: GOOD MORNING.
MR. WADE: WHEN WE MET LAST WEEK, WE WERE ASKING -- OR WE WERE HAVING SOME DISCUSSION RELATING TO THE INVESTMENT BY THE DEVOS FAMILY. DO YOU RECALL THAT?
LISA PETERSON: YES.
MR. WADE: AND I ASKED YOU DURING THAT DISCUSSION ABOUT A NUMBER OF DIFFERENT DEVOS FAMILY MEMBERS WHO ARE A PART OF THE DIFFERENT GENERATIONS THAT THE RDV CORPORATION SERVES. DO YOU RECALL THAT?
LISA PETERSON: YES.
MR. WADE: OKAY. AND I JUST WANTED TO ASK WHETHER YOU ARE AWARE -- DO YOU RECALL I ASKED YOU ABOUT WHETHER YOU WERE AWARE OF CERTAIN INTERACTIONS THAT MR. TUBERGEN HAD WITH CERTAIN MEMBERS OF THE DEVOS FAMILY? DO YOU RECALL THAT?
LISA PETERSON: YES, IN GENERAL.
MR. WADE: AND I THINK YOU SAID THERE WERE PROBABLY SOME OF THOSE CONVERSATIONS THAT YOU WERE NOT A PARTY TO; IS THAT RIGHT?
LISA PETERSON: CORRECT.
MR. WADE: OKAY. AND THERE WERE A COUPLE OF PEOPLE I'M NOT SURE I ASKED YOU ABOUT. ARE YOU AWARE WHETHER, WHETHER MR. TUBERGEN DISCUSSED THE POTENTIAL THERANOS INVESTMENT WITH DICK DEVOS?
LISA PETERSON: I WASN'T PRIVY TO THOSE. I DON'T KNOW.
LISA PETERSON: I WASN'T PRIVY TO THOSE. BETSY IS NOT ON THE INVESTMENT COMMITTEE THOUGH.
LISA PETERSON: DICK WAS.
MR. WADE: AND DO YOU KNOW WHETHER -- DO YOU KNOW WHETHER MR. TUBERGEN HAD DISCUSSIONS WITH THEM ABOUT THE THERANOS INVESTMENT?
LISA PETERSON: DICK WAS ON THE INVESTMENT COMMITTEE, AND I'M AWARE AND UNDERSTAND FROM MR. TUBERGEN THAT HE HAD LOTS OF DISCUSSIONS AROUND THIS TRANSACTION WITH THE INVESTMENT COMMITTEE MEMBERS.
MR. WADE: OKAY. AND ARE YOU AWARE THAT IT WAS IMPORTANT TO DICK AND BETSY DEVOS THAT RICK DEVOS BE INVOLVED IN THE DECISION?
LISA PETERSON: I'M NOT AWARE OF THEIR FEELINGS AROUND THAT.
MR. WADE: OKAY. WE ASKED -- YOU GAVE SOME TESTIMONY WITH RESPECT TO SOME FINANCIAL PROJECTIONS THAT YOU RECEIVED FROM THE COMPANY. DO YOU RECALL THAT TESTIMONY?
LISA PETERSON: YES.
MR. WADE: OKAY. LET'S PULL UP TRIAL EXHIBIT 1853, WHICH IS IN EVIDENCE. AND IT'S ON THE SCREEN. YOU'RE WELCOME TO PULL UP THE DOCUMENT.
LISA PETERSON: IS IT IN THIS ONE?
LISA PETERSON: OKAY.
LISA PETERSON: YES.
LISA PETERSON: YES.
COURT CLERK: JUST A MOMENT, YOUR HONOR. GIVE ME A MOMENT TO COULD A RESET.
LISA PETERSON: WHAT'S THE NUMBER AGAIN?
BY MR. WADE:
LISA PETERSON: OKAY.
MR. WADE: AND FOR THE RECORD, WE'RE JUST WAITING TO MAKE SURE THE JURORS ARE ABLE TO SEE THE EXHIBITS. WE'LL PAUSE FOR A MOMENT, YOUR HONOR.
JUDGE DAVILA: THANK YOU. THERE'S ONE MONITOR THAT IS STILL PROBLEMATIC.
COURT CLERK: NO? STILL NO? GIVE ME ONE SECOND TO RESTART. GIVE ME ONE SECOND.
(PAUSE IN PROCEEDINGS.)
MR. WADE: YOUR HONOR, I THINK ON ONE OCCASION WHEN WE RESET THE T.V. OR RESET THE SCREEN, IT DID COME BACK. MAYBE WE CAN TRY THE OLD ON AND OFF.
JUDGE DAVILA: YOU HAVE A CUP OF WATER THERE, MR. WADE. YOU'RE NOT SUGGESTING TO GET ANYWHERE CLOSE TO THAT MONITOR WITH THE WATER?
(LAUGHTER.)
(PAUSE IN PROCEEDINGS.)
JUDGE DAVILA: WHY DON'T YOU CHECK NOW, MS. KRATZMANN.
COURT CLERK: IT WAS ON THIS MORNING. I JUST HAVE TO THREATEN IT.
(LAUGHTER.)
JUDGE DAVILA: I THINK WE'RE ON NOW. GREAT. OKAY.
JUDGE DAVILA: WOULD YOU KNOCK ON WOOD BEFORE YOU BEGIN YOUR EXAMINATION. THANK YOU.
(KNOCKING.)
BY MR. WADE:
LISA PETERSON: YES.
LISA PETERSON: YES.
MR. WADE: AND DO YOU RECALL -- AND THIS WAS A DOCUMENT THAT WAS PRODUCED BY RDV IN CONNECTION WITH LITIGATION?
LISA PETERSON: NO. THIS WAS PART OF THE DILIGENCE BINDER THAT ELIZABETH HAD GIVEN US.
LISA PETERSON: WE DIDN'T PRODUCE THIS.
MR. WADE: AND DO YOU SEE IF YOU GO TO THE FIRST -- WELL, EITHER PAGE, IN THE CORNER DO YOU SEE THE RDV BATES LABEL DOWN IN THE CORNER THERE (INDICATING)?
LISA PETERSON: YES.
LISA PETERSON: OKAY. YES.
LISA PETERSON: BUT WE DIDN'T PRODUCE WHAT IS ON THE PAGE.
LISA PETERSON: CORRECT.
MR. WADE: BUT IT CAME INTO THIS CASE BECAUSE RDV SENT IT TO THE GOVERNMENT IN RESPONSE TO A SUBPOENA; IS THAT RIGHT?
LISA PETERSON: YES.
MR. WADE: OKAY. AND DO YOU RECALL WHETHER -- DID YOU GATHER MATERIALS IN CONNECTION WITH RESPONDING TO THAT SUBPOENA? WERE YOU ASKED TO GATHER MATERIALS TO GIVE TO THE GOVERNMENT?
LISA PETERSON: THEY TOOK ALL OF OUR EMAILS, EVERYTHING THAT WAS IN OUR EMAILS AND IN OUR DOCUMENT MANAGEMENT SYSTEM WENT TO THE GOVERNMENT.
LISA PETERSON: YES.
MR. WADE: OKAY. AND DO YOU RECALL YOUR TESTIMONY LAST WEEK THAT YOU GAVE, YOU WERE GIVEN ACTUALLY ABOUT A FOOT OF DOCUMENTS WHEN YOU FIRST GOT MATERIALS FROM THERANOS?
LISA PETERSON: YES.
MR. WADE: DO YOU RECALL WHETHER, WHEN YOU GOT THIS, THIS DOCUMENT, WHETHER IN ADDITION TO THESE TWO PAGES YOU ALSO RECEIVED A PRO FORMA STATEMENT OF CASH?
LISA PETERSON: THE TWO FINANCIAL PAGES THAT WE RECEIVED ARE THE ONES THAT YOU'RE LOOKING AT RIGHT HERE.
JUDGE DAVILA: YES.
MR. WADE: I'VE SHOWN YOU -- I'VE HANDED YOU WHAT HAS BEEN MARKED AS EXHIBIT 14210. DO YOU SEE THAT?
LISA PETERSON: WHERE AM I LOOKING?
LISA PETERSON: YES.
LISA PETERSON: YES.
MR. WADE: OKAY. I'D LIKE YOU TO JUST LOOK AT THE SECOND PAGE. DOES THAT REFRESH YOUR RECOLLECTION THAT YOU ALSO RECEIVED FROM THE COMPANY --
LISA PETERSON: OKAY.
LISA PETERSON: THE BACK OF THE FIRST PAGE?
LISA PETERSON: I DON'T RECALL THIS PAGE EXACTLY, NO.
MR. WADE: OKAY. THAT DOESN'T REFRESH YOUR RECOLLECTION THAT YOU ALSO RECEIVED A PRO FORMA STATEMENT OF CASH FLOW FROM THE COMPANY?
MR. LEACH: YOUR HONOR --
LISA PETERSON: THE TWO PAGES I REMEMBER VIVIDLY ARE THE OTHER TWO PAGES.
JUDGE DAVILA: EXCUSE ME, MS. PETERSON.
MR. LEACH: I OBJECT TO THE LINE OF QUESTIONING USING A DOCUMENT NOT FROM THIS WITNESS TO TRY TO REFRESH HER RECOLLECTION THAT SHE RECEIVED THIS. I THINK IT'S IMPROPER REFRESHING.
LISA PETERSON: I DON'T RECALL --
JUDGE DAVILA: MS. PETERSON, I'M SORRY.
LISA PETERSON: I'M SORRY.
JUDGE DAVILA: ANYTHING CAN BE USED TO REFRESH A WITNESS'S RECOLLECTION, A SHOE, A SOCK, SO --
JUDGE DAVILA: THANK YOU FOR THAT. BUT I NOTE -- I THINK I UNDERSTAND THE TENOR OF YOUR OBJECTION, MR. LEACH. BUT YOU CAN PROCEED.
JUDGE DAVILA: OKAY.
BY MR. WADE:
MR. WADE: IF WE CAN PULL UP 14106, WHICH IS IN EVIDENCE. DO YOU RECALL THIS EMAIL FROM MR. SCHIERBEEK?
LISA PETERSON: YES.
LISA PETERSON: YES.
MR. WADE: AND I THINK YOUR TESTIMONY AT THE TIME WAS THAT MR. SCHIERBEEK WAS NOT INVOLVED OR AUTHORIZED IN THE INVESTMENT DECISION; CORRECT?
LISA PETERSON: MR. SCHIERBEEK DID NOT WORK ON THE THERANOS OPPORTUNITY AT ALL, AND HE'S NOT PART OF THE INVESTMENT GROUP AND HE'S NOT ON THE INVESTMENT COMMITTEE.
LISA PETERSON: YES.
LISA PETERSON: YES.
LISA PETERSON: NO. HE RUNS THE FAMILY SERVICES SIDE OF THE HOUSE.
LISA PETERSON: IT HAS THE CASH, YES.
MR. WADE: OKAY. SO IF AN INVESTMENT DECISION IS ULTIMATELY MADE ON THE INVESTMENT SIDE OF THE HOUSE, MR. SCHIERBEEK WOULD BE THE PERSON WHO WOULD -- OR HIS OPERATION WOULD MAKE THE ARRANGEMENTS TO PROVIDE THE CASH IN CONNECTION WITH THE INVESTMENT?
LISA PETERSON: ONLY UPON A GREEN LIGHT FROM JERRY, RANDY IS HE ABLE TO SEND THE MONEY.
MR. WADE: RIGHT. SO HIS -- THE COMMUNICATIONS THAT HE MIGHT HAVE MIGHT RELATE TO, I'M GOING TO GIVE YOU A GREEN LIGHT, YOU SHOULD GET THE CASH READY. OR HERE'S A GREEN LIGHT, GET THE CASH READY. RIGHT?
LISA PETERSON: NO. THAT DOESN'T HAPPEN UNTIL I GET THE GREEN LIGHT FROM THE INVESTMENT COMMITTEE OR JERRY, AND THEN WE WORK WITH THAT SIDE OF THE HOUSE TO ACTUALLY FUND THE INVESTMENT. HE DOESN'T HAVE ANYTHING TO DO WITH INVESTMENT DECISIONS UP UNTIL THE POINT WHERE WE'VE DECIDED TO GO AND THERE'S A WIRE THAT HAS TO BE MADE.
MR. WADE: OKAY. I UNDERSTAND THAT. MY QUESTION IS, BUT HE'S THE ONE WHO PROVIDES THE CASH AND MAKES SURE THAT THERE'S CASH TO FUND THE INVESTMENT; CORRECT?
LISA PETERSON: HE JUST MANAGES THE BANK RELATIONSHIP TO WHICH WE HAVE TO DO THE WIRE.
LISA PETERSON: YES, BUT THAT'S --
LISA PETERSON: -- NOT DONE UNTIL EVERYTHING IS AGREED TO, AND EITHER MYSELF OR JERRY GIVES IT A GREEN LIGHT TO GO AHEAD AND WIRE THE CASH.
LISA PETERSON: AND HE'S A SIGNOR ON DOCUMENTS.
MR. WADE: IF THERE'S GOING TO BE -- RIGHT. YOU RECALL THAT HE'S THE ONE WHO ACTUALLY SIGNED THE INVESTMENT AGREEMENT; RIGHT?
LISA PETERSON: HE'S JUST A SIGNOR TO THE ENTITY THAT MADE THIS INVESTMENT, YES.
LISA PETERSON: HE'S --
MR. LEACH: OBJECTION. ASKED AND ANSWERED.
JUDGE DAVILA: WELL, YOU CAN ANSWER THE QUESTION.
LISA PETERSON: HE CAN ONLY SIGN UNLESS IT'S APPROVED BY OTHER PEOPLE.
BY MR. WADE:
LISA PETERSON: BUT, YES, HE HAS SIGNING AUTHORITY ON THAT PARTICULAR ENTITY. WE HAVE HUNDREDS OF ENTITIES.
MR. WADE: I UNDERSTAND. AND SO IF AN INVESTMENT DECISION IS MADE BY MR. TUBERGEN, HE COULD TALK TO MR. SCHIERBEEK --
LISA PETERSON: UH-HUH.
LISA PETERSON: NO. NO. THAT COMES OUT OF THE INVESTMENT GROUP. THAT GREEN LIGHT GOES FROM JERRY TO ME TO THE ACCOUNTING GROUP.
JUDGE DAVILA: YES.
LISA PETERSON: YES.
MR. WADE: AND THAT'S AN EMAIL BETWEEN MR. SCHIERBEEK AND MR. BRINKS AND MR. LAMBERT ON OCTOBER 6TH, 2014 ON THE BOTTOM; CORRECT?
LISA PETERSON: YES.
LISA PETERSON: IT REFERENCES TWO ACTIVE COINVESTMENTS THAT -- THEY'RE TRYING TO DO CASH FLOW PLANNING.
MR. LEACH: NO OBJECTION, YOUR HONOR.
JUDGE DAVILA: IT'S ADMITTED. IT MAY BE PUBLISHED.
(DEFENDANT'S EXHIBIT 14212 WAS RECEIVED IN EVIDENCE.)
MR. WADE: DO YOU SEE IN THE BOTTOM EMAIL IT'S AN EMAIL ON OCTOBER 6TH, 2014, FROM MR. SCHIERBEEK TO MR. BRINKS AND MR. LAMBERT? DO YOU SEE THAT?
LISA PETERSON: YES.
LISA PETERSON: YES, HE'S THE CONTROLLER, AND MR. LAMBERT AT THE TIME WAS THE CFO.
LISA PETERSON: YES, AND CASH FLOW PLANNING FOR THE FAMILY, YES.
MR. WADE: OKAY. AND DO YOU SEE THERE IN THE SECOND PARAGRAPH IT SAYS, "THERE ARE TWO VERY 'ACTIVE' CO-INVESTMENTS (NOT IN OUR CASH FLOW MODEL) THAT WILL LIKELY TAKE PLACE AT OR NEAR MONTH END." DO YOU SEE THAT?
LISA PETERSON: YES.
LISA PETERSON: YES.
LISA PETERSON: YES.
MR. WADE: AND THAT WAS THE DATE THAT YOU PREPARED YOUR MEMO COMING OUT OF THAT PHONE CALL; CORRECT?
LISA PETERSON: YES.
LISA PETERSON: YES.
MR. WADE: OKAY. AND DO YOU KNOW WHETHER YOU HAD ANY COMMUNICATIONS WITH MR. SCHIERBEEK IN CONNECTION WITH THIS?
LISA PETERSON: NO. BUT THIS IS ALL CASH FLOW PLANNING. THIS IS NOT UNCOMMON AT ALL. WE HAVE NINE DEALS IN THE HOPPER RIGHT NOW. SOME GO, SOME DON'T GO. THEY'RE JUST TRYING TO UNDERSTAND HOW MUCH CASH IS AVAILABLE GIVEN ALL OF THE ACTIVITY THAT WE WERE LOOKING AT AT THE MOMENT.
JUDGE DAVILA: ALL RIGHT. EVERYTHING AFTER THE RESPONSE "NO" IS STRICKEN. IT'S NONRESPONSIVE.
BY MR. WADE:
MR. WADE: THE -- I DON'T HAVE ANY FURTHER QUESTIONS ABOUT THAT. YOU CAN SET THAT ASIDE. ACTUALLY, I HAVE ONE MORE QUESTION. DO YOU KNOW WHETHER MR. TUBERGEN HAD ANY CONVERSATIONS WITH MR. SCHIERBEEK IN CONNECTION WITH CASH FLOW PLANNING RELATING TO THERANOS?
LISA PETERSON: WE HAVE CASH FLOW PLANNING CONVERSATIONS ALL OF THE TIME. AROUND THIS? NO, I WASN'T PRIVY TO THOSE CONVERSATIONS.
MR. WADE: OKAY. MY QUESTION WAS, DO YOU KNOW WHETHER MR. TUBERGEN HAD ANY COMMUNICATIONS WITH MR. SCHIERBEEK IN CONNECTION WITH CASH FLOW PLANNING RELATING TO THE THERANOS INVESTMENT IN THIS OCTOBER 6TH TIME PERIOD?
LISA PETERSON: I CAN ONLY SURMISE THAT THEY DID TALK ABOUT IT BECAUSE HE'S TRYING TO FIGURE OUT HOW MUCH CASH DOES THE FAMILY HAVE IN ORDER TO DO SOME OF THESE INVESTMENTS THAT WE WERE LOOKING AT.
LISA PETERSON: NOT AT THAT TIME, NO.
LISA PETERSON: 1992 OR 1192?
LISA PETERSON: 11 OR 19? BECAUSE IT ONLY GOES TO 4.
LISA PETERSON: OKAY.
LISA PETERSON: YES.
MR. WADE: AND IS THIS AN EMAIL BETWEEN YOU AND MR. DAMSTRA RELATING TO YOUR POTENTIAL INVOLVEMENT IN THE THERANOS INVESTMENT?
LISA PETERSON: YES.
MR. LEACH: NO OBJECTION.
JUDGE DAVILA: IT'S ADMITTED. IT MAY BE PUBLISHED.
(GOVERNMENT'S EXHIBIT 1992 WAS RECEIVED IN EVIDENCE.)
BY MR. WADE:
MR. WADE: AND DO YOU RECALL IN YOUR TESTIMONY LAST WEEK YOU TALKED ABOUT HOW YOU HAD DISCUSSIONS WITH MR. TUBERGEN ON A PLANE RIDE BACK FROM CHICAGO IN MID-SEPTEMBER ABOUT POSSIBLY WORKING ON THE THERANOS INVESTMENT?
LISA PETERSON: YES.
MR. WADE: AND DOES THIS EMAIL INDICATE THAT BETWEEN THAT DATE, NOVEMBER 18TH, AND NOVEMBER 30TH, YOU HADN'T DONE ANY WORK ON THE THERANOS INVESTMENT YET; IS THAT RIGHT?
LISA PETERSON: THAT DOESN'T INDICATE THAT, NO.
MR. WADE: OKAY. YOU WERE TRYING TO, THROUGH THIS EMAIL, TO OFFER YOUR SERVICES AND GET INVOLVED IN THAT INVESTMENT; IS THAT RIGHT?
LISA PETERSON: YES. AS I MENTIONED LAST WEEK, BDT WASN'T MY RELATIONSHIP, SO I WASN'T SURE WHO WAS GOING TO END UP WORKING ON THIS ONE, AND I WANTED TO RAISE MY HAND.
MR. WADE: OKAY. AND YOU DIDN'T HAVE ANY ACTIVE PARTICIPATION WITH MR. TUBERGEN BETWEEN THE PLANE RIDE THAT YOU HAD WITH HIM AND THIS DATE; IS THAT CORRECT?
LISA PETERSON: I DON'T REMEMBER.
LISA PETERSON: OKAY.
LISA PETERSON: YES.
MR. WADE: AND DO YOU RECOGNIZE THIS TO BE A COVER LETTER FROM MS. HOLMES TO MR. TUBERGEN THAT WAS ATTACHED TO THE BINDERS OF INFORMATION THAT WERE SENT TO RDV?
LISA PETERSON: YES.
MR. LEACH: NO OBJECTION, YOUR HONOR.
JUDGE DAVILA: IT'S ADMITTED. IT MAY BE PUBLISHED.
(DEFENDANT'S EXHIBIT 14076 WAS RECEIVED IN EVIDENCE.)
MR. WADE: DO YOU SEE THERE DISCUSSION OR STATEMENTS BY MS. HOLMES RELATING TO THE DESIRE TO TERM -- TO OBTAIN A LONG-TERM VISION FOR THERANOS? DO YOU SEE THAT?
LISA PETERSON: YES.
MR. WADE: AND DO YOU SEE THAT THERE'S REFERENCE TO THE FACT THAT THE COMPANY WANTS TO STAY PRIVATE OVER THE LONG-TERM? DO YOU SEE THAT?
LISA PETERSON: YES.
MR. WADE: OKAY. LET ME DRAW YOUR ATTENTION TO THE PARAGRAPH STARTING WITH "ONCE." DO YOU SEE THAT? AND DO YOU SEE THAT THEY -- THERE'S REFERENCE TO THE WALGREENS CONTRACT IN THE FALL OF 2013. DO YOU SEE THAT?
LISA PETERSON: YES.
LISA PETERSON: YES.
MR. WADE: OKAY. AND DO YOU SEE AT THE END THE LAST SENTENCE WHERE IT SAYS, "ALL CURRENT RESOURCES ARE FOCUSSED ON THIS COMMERCIAL LABORATORY BUSINESS"? DO YOU SEE THAT?
LISA PETERSON: YES.
MR. WADE: AND THEN IT SAYS, "FUTURE GROWTH IN THE PHARMACEUTICAL, MILITARY, AND OTHER BUSINESS WILL FOLLOW THE SUCCESSFUL ESTABLISHMENT OF THERANOS'S COMMERCIAL LABORATORY INFRASTRUCTURE NATIONWIDE." DO YOU SEE THAT?
LISA PETERSON: I SEE THAT. BUT I ALSO SEE TWO PARAGRAPHS UP WHERE IT SAYS, "HISTORICALLY THERANOS'S WORK WAS FOCUSSED ON CONTRACTS WITH PHARMACEUTICAL AND MILITARY CLIENTS."
JUDGE DAVILA: THAT'S STRICKEN.
BY MR. WADE:
MR. WADE: I DO NOTE OTHER REFERENCES TO THE HISTORICAL WORK OF THE COMPANY ABOVE; CORRECT? THERE WERE REFERENCES TO THE HISTORICAL WORK THAT THE COMPANY HAD WITH MILITARY AND PHARMACEUTICAL COMPANIES ABOVE; RIGHT?
LISA PETERSON: YES, AND THAT WAS VERY RELEVANT.
MR. WADE: AND YOU SEE WHERE IT SAYS THAT ALL OF THAT WORK IS ON HOLD BECAUSE THEY'RE FOCUSSED ON -- --
LISA PETERSON: THEY'RE COMMERCIALIZING.
MR. WADE: THEY HAVE ALL OF THEIR EFFORTS FOCUSSED ON THE COMMERCIAL LABORATORY BUSINESS. DO YOU SEE THAT?
LISA PETERSON: YES.
MR. WADE: AND DO YOU SEE ANYWHERE IN THIS LETTER THAT REFERS TO A THERANOS DEVICE OR AN EDISON OR A MINILAB?
LISA PETERSON: THE WHOLE BINDER THAT THIS LETTER WAS ATTACHED TO WAS REFERRING TO THE DEVICE.
LISA PETERSON: OKAY.
LISA PETERSON: YES.
LISA PETERSON: YES.
LISA PETERSON: NOT SPECIFICALLY. BUT IT WAS ATTACHED TO THE BINDER THAT REFERENCED THE DEVICE AND EVERYTHING ELSE.
MR. WADE: I UNDERSTAND. DO YOU UNDERSTAND MY QUESTION IS, DO YOU SEE ANYWHERE IN THE LETTER THAT REFERS TO THE DEVICE?
LISA PETERSON: YES.
MR. WADE: CAN YOU GO TO 14 -- 18 -- I'M SORRY, LET ME START OVER -- 4858, WHICH SHOULD BE IN THE WHITE BINDER.
LISA PETERSON: YES.
LISA PETERSON: YES.
MR. WADE: OKAY. AND DO YOU RECALL YOU PREPARED A MEMO IN MID-OCTOBER RELATING TO YOUR DISCUSSIONS AND YOUR REVIEW OF THE MATERIALS PROVIDED BY THERANOS. DO YOU RECALL THAT?
LISA PETERSON: I DID TWO MEMOS, ONE BEFORE GOING TO PALO ALTO AND ONE AFTER.
MR. WADE: RIGHT. DO YOU RECALL THE ONE -- THE ONE GOING BEFORE PALO ALTO YOU PREPARED MAYBE OCTOBER 12TH TO 15TH, IN THAT PERIOD?
LISA PETERSON: YES, I SUMMARIZED THE DUE DILIGENCE BINDERS AND OUR CALLS WITH MS. HOLMES.
MR. WADE: OKAY. AND ON DIRECT EXAMINATION MR. LEACH WALKED YOU THROUGH 4858, MANY OF THE SLIDES IN THAT.
LISA PETERSON: YES.
MR. WADE: DO YOU RECALL THAT? AND HE ASKED YOU QUESTIONS ABOUT DIFFERENT STATEMENTS IN THOSE SLIDES; RIGHT?
LISA PETERSON: YES.
MR. WADE: OKAY. CAN YOU -- YOUR -- JUST FOR YOUR REFERENCE, WE WON'T PUBLISH IT, BUT YOUR, YOUR MEMO, MID-OCTOBER MEMO IS AT 2073. CAN YOU IDENTIFY ANY STATEMENT IN 2073 --
LISA PETERSON: THE FIRST MEMO OR THE SECOND ONE?
LISA PETERSON: YES.
MR. WADE: AND I'M WONDERING IF YOU'RE AWARE OF ANY STATEMENT AT ALL THAT COMES FROM THIS SLIDE DECK AND MADE IT INTO YOUR MEMO.
LISA PETERSON: THE MEMO CAME FROM EVERYTHING THAT I HAD READ AND EVERYTHING THAT WE HAD HEARD HER SAY IN THE PHONE CALL. I DIDN'T MAKE UP ANY OTHER STUFF. PLUS WHATEVER WE COULD READ ON THE INTERNET.
MR. WADE: RIGHT. RIGHT. DO YOU RECALL THAT A LOT OF THE STATEMENTS I THINK WE ESTABLISHED DURING YOUR EXAMINATION LAST WEEK CAME OUT OF THE FOR "FORTUNE" ARTICLE. DO YOU RECALL THAT?
LISA PETERSON: NO, IT WASN'T A LOT.
LISA PETERSON: A FEW IN THE APPENDIX, YES. I THOUGHT THAT WAS RELEVANT FOR THE FAMILY TO KNOW WHAT SHE WAS SAYING IN THE MEDIA.
MR. WADE: OKAY. ARE YOU ABLE TO TRACK ANY STATEMENTS SPECIFICALLY FROM THIS SLIDE DECK TO YOUR MEMO?
LISA PETERSON: NOT AT THE MOMENT, NO. BUT EVERYTHING IN THAT MEMO CAME FROM THESE BINDERS OR A CONVERSATION WITH HER.
MR. WADE: RIGHT. AND ARE YOU ABLE TO IDENTIFY -- I'VE REVIEWED THE EXHIBIT AND I'VE REVIEWED YOUR MEMO. CAN YOU -- AND I ASSUME YOU HAVE; CORRECT?
MR. LEACH: OBJECTION. COUNSEL IS TESTIFYING.
LISA PETERSON: IF YOU PUT SOME STUFF --
JUDGE DAVILA: EXCUSE ME, MS. PETERSON. YOU WEREN'T TESTIFYING THERE --
JUDGE DAVILA: -- FOR THE BENEFIT OF THE JURY INDICATING WHAT YOU'VE DONE. THIS WAS FOUNDATIONAL?
LISA PETERSON: YES.
MR. WADE: AND ARE YOU AWARE, IN REVIEWING THESE DOCUMENTS, OF ANY STATEMENT THAT COMES FROM THIS SLIDE DECK THAT APPEARED IN EXHIBIT 2073?
LISA PETERSON: THE ONLY WAY I PUT THE MEMO TOGETHER WAS BASED ON WHAT I READ AND WHAT WE HEARD.
LISA PETERSON: I DON'T KNOW IF IT WAS EVERYTHING THAT I READ AND HEARD, BUT THE MEMO WAS BASED ON MY DILIGENCE OF THE BINDERS AND WHAT WE HEARD ON THE PHONE CALL, YES. WE WERE PREPPING THE FAMILY. WE TALKED ABOUT THE OPPORTUNITY AT LENGTH ON THE PLANE, AND THEN THEY HEARD MUCH OF WHAT WAS IN THE MEMO, THEY HEARD IN PERSON WHEN WE WERE AT THE MEETING IN PALO ALTO.
MR. WADE: DO YOU -- BUT AS YOU SIT HERE TODAY, YOU'RE NOT AWARE OF ANY STATEMENT THAT COMES FROM THE SLIDE DECK DIRECTLY INTO THE MEMO LIKE THOSE "FORTUNE" STATEMENTS; IS THAT CORRECT?
LISA PETERSON: I DIDN'T MEMORIZE THE WHOLE FOOT OF PAPER TO TELL YOU WHAT CAME FROM THERE IN MY MEMO OR NOT.
MR. WADE: LET'S LOOK AT THE INCH OF PAPER. IF I COULD TURN YOUR ATTENTION TO PAGE 51 OF THE SLIDE DECK AT 12723. DO YOU HAVE THAT IN FRONT OF YOU? IT'S ON THE SCREEN THERE AS WELL IF THAT'S EASIER.
LISA PETERSON: OKAY.
LISA PETERSON: YES.
MR. WADE: IS THAT THE BUILDING THAT YOU WENT TO WHEN YOU WENT ON THE VISIT WITH THE DEVOS FAMILY?
LISA PETERSON: I BELIEVE THAT'S THE NEW BUILDING. WE WENT TO THE OLD BUILDING.
LISA PETERSON: YES.
LISA PETERSON: NO. WE ASKED. THEY SAID WE COULDN'T GO THERE.
LISA PETERSON: IT WAS TOP SECRET.
LISA PETERSON: WE WERE TOLD THAT'S WHERE THEY MADE THE MACHINES.
LISA PETERSON: THE ANALYZER EQUIPMENT.
MR. WADE: LET'S GO TO PAGE 54. DO YOU SEE -- WAS THIS MATERIAL THAT YOU RECEIVED IN CONNECTION WITH YOUR INVESTMENT?
LISA PETERSON: I BELIEVE SO.
LISA PETERSON: YES.
LISA PETERSON: YES.
LISA PETERSON: YES.
MR. WADE: OKAY. AND LET'S GO TO THE NEXT PAGE. DO YOU CONSIDER THIS -- DO YOU SEE THIS, THAT IT IS MORE OF THE SAME? THESE ARE FEEDBACK FROM CUSTOMERS? DO YOU SEE THAT?
LISA PETERSON: YES. AND MY TAKEAWAY WAS THAT THE WORK THAT THEY WERE DOING IN WALGREENS WAS WORKING.
LISA PETERSON: AND PEOPLE WERE SATISFIED.
MR. WADE: OKAY. AND YOU CONSIDERED THAT. AND SIMILARLY, IF WE CAN GO TO SLIDE 57, THERE'S FEEDBACK FROM PHYSICIANS. DO YOU SEE THAT? ACTUALLY, LET'S TURN OFF THAT PAGE AND GO UP ONE, PLEASE. LET'S JUST LEAVE THAT DOWN. IT'S NOT -- THERE'S SOME NAMES THAT ARE NOT REDACTED. BUT IF YOU CAN JUST HAVE IN FRONT OF YOU, DO YOU SEE THAT THERE'S ALSO FEEDBACK ON SLIDE 57 FROM DIFFERENT PHYSICIANS WHO GAVE REVIEWS OF THE WORK PERFORMED AT THERANOS?
LISA PETERSON: YES.
LISA PETERSON: YES, VERY RELEVANT.
MR. WADE: OKAY. NOW -- AND YOU RECOGNIZE THAT MANY OF THE COMMENTS IN THERE REFERRED TO THE FAVORABLE PRICING THAT THERANOS HAD; IS THAT RIGHT?
LISA PETERSON: THE FAVORABLE PRICING, AS WELL AS THE FACT THAT THE FINGERSTICK TECHNOLOGY WORKED. IT LENDED CREDIBILITY TO THAT, YES.
MR. WADE: I'M SORRY TO INTERRUPT. BUT SOME PEOPLE LIKED THE FINGERSTICK TECHNOLOGY AS WELL; RIGHT?
LISA PETERSON: YES.
LISA PETERSON: YES.
MR. WADE: AND SOME PEOPLE LIKED THE FACT THAT INSURED AND UNINSURED WERE PAID -- WERE PAID THE SAME AMOUNT; RIGHT?
LISA PETERSON: YES.
MR. WADE: OKAY. LET'S GO TO EXHIBIT -- PAGE 73. AND DO YOU SEE THIS IS A REFERENCE TO THE DIFFERENT LOCATIONS WHERE THEY WERE PROVIDING SERVICES AT THAT TIME?
LISA PETERSON: THAT'S WHAT I WOULD HAVE ASSUMED, YES.
MR. WADE: OKAY. AND DO YOU SEE THAT MANY OF THE LOCATIONS PROVIDE SERVICES FROM 6:00 A.M. TO 10:00 P.M. DO YOU SEE THAT?
LISA PETERSON: YES.
LISA PETERSON: OKAY.
MR. WADE: AND THAT CONVENIENCE WAS A PRETTY SIGNIFICANT FACTOR, SIGNIFICANT PORTION OF THERANOS'S OFFERING. DO YOU RECALL THAT?
LISA PETERSON: YES.
MR. WADE: OKAY. LET ME BRING YOU TO PAGE 44. I'M SORRY, LET'S GO TO -- WELL, WE CAN GO TO 44. DO YOU SEE THOSE ARE PICTURES OF THE THERANOS WELLNESS CENTER?
LISA PETERSON: YES.
LISA PETERSON: IN THEIR BUILDING THEY HAD SOMETHING JUST LIKE THIS WHERE CHERI WAS TESTED AND WE WERE TOLD THAT THIS IS PRETTY MUCH WHAT THEIR WELLNESS CENTERS LOOKED LIKE INSIDE OF WALGREENS.
LISA PETERSON: NO. BUT I SAW IT FIRST HAND. I WASN'T RELYING ON THIS PICTURE. I WAS RELYING ON THE TOUR THAT WE GOT OF THE WELLNESS CENTER INSIDE OF THEIR BUILDING.
JUDGE DAVILA: WHAT WAS OBSERVED AT THE WELLNESS CENTER -- EXCUSE ME, AT THE THERANOS BUILDING IS STRICKEN.
LISA PETERSON: I DON'T REMEMBER IT OFF THE TOP OF MY HEAD, BUT I'M SURE I READ IT. I READ EVERYTHING IN THE BINDERS AT THE TIME. IT WAS A LONG TIME AGO.
MR. WADE: OKAY. AND DO YOU SEE, DO YOU SEE WHERE IT SAYS PATIENTS RECEIVE -- OR THAT DOCTORS WILL GET PATIENTS' RESULTS BACK IN LESS THAN 48 HOURS ON AVERAGE? DO YOU SEE THAT?
LISA PETERSON: YES.
MR. WADE: AND DO YOU HAVE ANY SENSE FOR WHY IT WOULD TAKE 48 HOURS IF THE DEVICE WAS IN THE WELLNESS CENTER?
LISA PETERSON: WELL, WE WERE TOLD THAT IT WOULDN'T TAKE THAT LONG. IN FACT, CHERI WAS TOLD THAT SHE WOULD HAVE EMAIL RESULTS RATHER QUICKLY.
LISA PETERSON: I BELIEVE -- I KNOW SHE HAD THEM EMAILED THAT DAY, BUT I DON'T KNOW WHAT THEY SAID.
MR. WADE: BUT YOU SAID YOU WERE TOLD THAT, BUT YOU WERE ACTUALLY TOLD RIGHT HERE THAT THE RESULTS WERE GIVEN LESS THAN 48 HOURS ON AVERAGE. DO YOU SEE THAT?
LISA PETERSON: ON AVERAGE. BUT THAT'S NOT WHAT SHE WAS VERBALLY SAYING.
LISA PETERSON: OKAY.
MR. WADE: OKAY. I BELIEVE YOU TESTIFIED WITH RESPECT TO YOUR -- YOU TESTIFIED WITH RESPECT TO YOUR BELIEF THAT THE TESTS WERE PERFORMED ON THE DEVICES IN THE WALGREENS AT THE TIME THAT YOU WENT TO THERANOS; IS THAT RIGHT?
LISA PETERSON: SAY THE QUESTION AGAIN.
MR. WADE: YOU SAID THAT THE DEVICE -- YOU WERE OF THE VIEW, OR OF THE UNDERSTANDING, THAT THE DEVICES WERE IN THE ACTUAL WALGREENS LOCATIONS AT THE TIME THAT YOU MET WITH THERANOS?
LISA PETERSON: YES. THERE WAS NO OTHER REASON TO THINK ANYTHING ELSE.
LISA PETERSON: YES.
MR. WADE: OKAY. AND IN CONNECTION WITH THE INTERNET RESEARCH, DID YOU GO TO THE FIRST PAGE OF THE THERANOS SITE?
LISA PETERSON: I DON'T KNOW.
MR. WADE: OKAY. DO YOU RECALL WHETHER YOU SAW A SITE THAT ON THE FIRST PAGE OF THE THERANOS SITE SAYS THAT THE TESTS AT WALGREENS ARE PERFORMED IN THE CLIA LAB?
LISA PETERSON: EVERYTHING THAT WAS TOLD TO US WAS -- SUGGESTED THAT EVERYTHING THAT WAS BEING DONE WAS ON THE ANALYZER EQUIPMENT.
LISA PETERSON: WE DID NOT KNOW THAT THERE WAS VENOUS TESTING UNTIL WE READ "THE WALL STREET JOURNAL" ARTICLE A YEAR LATER. IT'S NOT WHAT WE HAD INVESTED IN. IT'S NOT WHAT WE HAD THOUGHT WE HAD INVESTED IN.
JUDGE DAVILA: OVERRULED.
BY MR. WADE:
MR. WADE: THE -- MY QUESTION RELATED TO THE WEBSITE AND WHETHER YOU SAW REFERENCES ON THE WEBSITE RELATING TO THE FACT THAT WALGREENS TESTS WERE PERFORMED IN THE CLIA LAB. DID YOU SEE THAT REFERENCE?
LISA PETERSON: I DON'T -- I CAN'T ANSWER THAT QUESTION. I DON'T REMEMBER.
LISA PETERSON: I DON'T REMEMBER SEEING THAT REFERENCE. I'M JUST TELLING YOU WHAT WE KNEW AT THE TIME, WHICH WAS THAT EVERYTHING WAS BEING DONE ON THE ANALYZER EQUIPMENT. THERE WAS NEVER ANY CONVERSATION AROUND VENOUS DRAWS EVER.
LISA PETERSON: SORRY.
JUDGE DAVILA: EXCUSE ME. WAIT FOR HIS QUESTION AND THEN YOU CAN ANSWER IT. THAT LAST RESPONSE IS STRICKEN.
BY MR. WADE:
MR. WADE: NOW, IF I CAN DRAW YOUR ATTENTION TO 104, PAGE 104 OF THE SAME EXHIBIT. DO YOU HAVE THAT IN FRONT OF YOU?
LISA PETERSON: YES.
LISA PETERSON: YES.
MR. WADE: AND DO YOU RECALL THAT YOU GAVE TESTIMONY THAT YOU BELIEVED THAT THIS WAS PREPARED BY PFIZER; CORRECT?
LISA PETERSON: YES.
LISA PETERSON: YES.
MR. WADE: OKAY. AND DO YOU RECALL THAT IN THAT INTERVIEW YOU TOLD THE GOVERNMENT THAT YOU DIDN'T KNOW WHO WROTE THE REPORT INCLUDED IN THE SET WITH THE PFIZER LOGO?
LISA PETERSON: I DON'T RECALL SAYING THAT.
MR. WADE: OKAY. LET ME SEE IF I CAN REFRESH YOUR RECOLLECTION. CAN YOU PULL THAT INTERVIEW UP. IT'S 11249. LET ME KNOW -- AND I'M LOOKING AT PAGE 2 OF 11249. DO YOU HAVE THAT IN FRONT OF YOU?
LISA PETERSON: YES.
MR. WADE: GO -- LOOK AT THE BOTTOM OF PAGE 2, LAST SENTENCE, AND PLEASE JUST READ IT TO YOURSELF AND WAIT FOR MY QUESTION. HAVE YOU READ THAT TO YOURSELF?
LISA PETERSON: YES.
MR. WADE: AND DOES THAT REFRESH YOUR RECOLLECTION THAT YOU TOLD THE GOVERNMENT THAT YOU DID NOT KNOW WHO WROTE THE REPORT INCLUDED IN THE SET OF DOCUMENTS WITH PFIZER'S LOGO?
LISA PETERSON: THAT'S NOT EXACTLY HOW I RECALL IT, NO.
LISA PETERSON: I MEAN, I DON'T KNOW WHO ELSE WOULD HAVE WRITTEN IT BUT PFIZER OR THERANOS.
MR. WADE: WHEN YOU -- JUST SO WE'RE CLEAR, AND I'M SURE I KNOW THE ANSWER TO THIS, BUT YOU TOLD THE TRUTH WHEN YOU MET WITH THE GOVERNMENT; RIGHT?
LISA PETERSON: YES, OF COURSE.
LISA PETERSON: YES.
MR. WADE: YES. AND YOU WERE CAREFUL IN WHAT YOU SAID TO TRY TO MAKE SURE THAT IT WAS ACCURATE; RIGHT?
LISA PETERSON: YES.
MR. WADE: IF I CAN CALL YOUR ATTENTION -- NOW, THIS PFIZER DOCUMENT THAT IS UP ON THE SCREEN, YOU DIDN'T SPECIFICALLY MENTION THAT PFIZER DOCUMENT IN EITHER ONE OF YOUR MEMOS, DID YOU?
LISA PETERSON: NO. BUT AS I SAID, PFIZER -- IN REVIEWING THAT, IT LENDED CREDIBILITY. I DIDN'T SUMMARIZE THIS PFIZER STUDY. IT JUST LENDED CREDIBILITY THAT THEY HAD DONE WORK WITH PFIZER AND PFIZER WAS OKAYING THAT THE ANALYZER DID WORK. THAT'S WHAT THIS WAS -- THAT'S THE TAKEAWAY FROM THIS FOR US.
JUDGE DAVILA: I WILL STRIKE THAT NOW. BUT, MR. WADE, SOME OF YOUR QUESTIONS LEND THEMSELVES TO AN EXPLANATION SO --
MR. WADE: IF YOU GO TO THE BOTTOM -- LET'S GO TO THE BOTTOM OF THE PAGE. THE VERY BOTTOM, I'M SORRY, NOT THE PARAGRAPH. THE FOOTER. DO YOU SEE THE FOOTER?
LISA PETERSON: YES.
LISA PETERSON: I DON'T KNOW.
LISA PETERSON: NOT OFF THE TOP OF MY HEAD, NO.
LISA PETERSON: YES.
MR. WADE: OKAY. LET'S GO TO THE SECOND PAGE. LET'S LOOK AT THAT SAME LANGUAGE IN THE FOOTER. DO YOU SEE THAT IS THERANOS'S WEBSITE THERE?
LISA PETERSON: YES.
LISA PETERSON: I, I DON'T KNOW.
LISA PETERSON: I DON'T KNOW. I WOULD IMAGINE YES. IT'S A LONG TIME AGO.
MR. WADE: DO YOU RECALL BEING ASKED SOME QUESTIONS ABOUT WHEN THE INVESTMENT COMMITMENT WAS MADE?
LISA PETERSON: YES.
MR. WADE: OKAY. AND IT WAS IN CONNECTION WITH A MEETING THAT HAPPENED AT THERANOS ON OCTOBER 15TH; CORRECT?
LISA PETERSON: CORRECT.
MR. WADE: AND ISN'T IT TRUE THAT A DECISION HAD BEEN MADE AT THE END OF THAT MEETING TO INVEST A HUNDRED MILLION DOLLARS?
LISA PETERSON: THEY HAD TALKED ABOUT THAT BEING OUR COMMITMENT, YES.
LISA PETERSON: I WOULDN'T SAY.
JUDGE DAVILA: MS. PETERSON, LET HIM FINISH HIS QUESTION SO YOU'LL HAVE THE FULL BENEFIT OF IT.
LISA PETERSON: SORRY.
BY MR. WADE:
MR. WADE: MY QUESTION IS THAT THE DECISION HAD BEEN MADE AT THE END OF THAT MEETING TO INVEST $100 MILLION; CORRECT?
LISA PETERSON: THAT'S NOT A YES OR NO QUESTION FOR ME.
LISA PETERSON: THE FAMILY WAS VERY WELL --
MR. WADE: THERE'S NO QUESTION PENDING RIGHT NOW. DO YOU RECALL GIVING TESTIMONY IN A DEPOSITION? WE TALKED ABOUT THAT LAST WEEK; RIGHT?
LISA PETERSON: YES.
LISA PETERSON: YES.
MR. WADE: YES. AND YOU RECALL THAT YOU WERE UNDER THE PAINS AND PENALTIES OF PERJURY TO GIVE TRUTHFUL ANSWERS? DO YOU RECALL THAT?
LISA PETERSON: YES.
JUDGE DAVILA: LET'S STOP FOR JUST A SECOND. AND, FOLKS, LET'S TAKE TWO MINUTES TO STAND AND STRETCH, PLEASE. LET'S JUST TAKE A STRETCHING BREAK HERE.
(STRETCHING.)
JUDGE DAVILA: YES, OF COURSE.
(DISCUSSION AMONGST DEFENSE COUNSEL OFF THE RECORD.)
JUDGE DAVILA: THANK YOU. MR. WADE.
BY MR. WADE:
LISA PETERSON: PAGE 74 IS JUST THE "FORTUNE" ARTICLE.
LISA PETERSON: OKAY. YES.
LISA PETERSON: YES.
MR. WADE: OKAY. I WOULD DRAW YOURS, COUNSEL, AND THE COURT'S ATTENTION TO PAGE 74, LINE 13. YOU WERE ASKED, "SO THE DECISION HAD BEEN MADE AT THE END OF THAT MEETING TO INVEST 100 MILLION?" AND YOU ANSWERED, "CORRECT." IS THAT RIGHT?
LISA PETERSON: OKAY. YES.
LISA PETERSON: YES, WE TALKED ABOUT THAT, YES.
MR. WADE: OKAY. OKAY. AND THIS WAS -- THIS DECISION HAD BEEN MADE BEFORE YOU CREATED YOUR SECOND MEMO; CORRECT?
LISA PETERSON: YES.
MR. WADE: OKAY. AND YOU DID NOT HAVE ANY SEPARATE MEETINGS OR VERBAL COMMUNICATIONS WITH MR. DEVOS OR MR. TUBERGEN BEFORE THEY MADE THAT COMMITMENT IN THAT MEETING ON THAT DAY; CORRECT?
LISA PETERSON: I DID NOT -- SAY IT AGAIN.
LISA PETERSON: THERE WERE LOTS OF DISCUSSIONS ON THE WAY TO THE MEETING IN THE PLANE WHERE WE DISCUSSED EVERYTHING. WE WENT THROUGH THE FIVE HOUR MEETING IN WHICH DOUG WAS APART OF IT AND SO WAS RICK, WHO WERE BOTH ON THE INVESTMENT COMMITTEE. WE CAUCUSED OUTSIDE. THEY TALKED ABOUT DOING 100 IN THE MEETING. THAT WAS KIND OF WHERE THEY LANDED. FROM THAT POINT FORWARD I NEEDED THE GREEN LIGHT FROM JERRY IN ORDER TO MOVE FORWARD WITH CLOSING THE INVESTMENT. SO, YES, HAD THEY DECIDED TO MOVE FORWARD -- DO THE WORK AND PROCESS THAT WE GO THROUGH TO CLOSE ON A TRANSACTION, YES, THAT WAS WHAT WAS DISCUSSED IN THE PARKING LOT BEFORE WE DISBURSED.
LISA PETERSON: OKAY.
LISA PETERSON: YES.
MR. WADE: AND I THINK WE JUST ESTABLISHED THAT THE DECISION TO MAKE THE $100 MILLION INVESTMENT WAS MADE IN THE MEETING; CORRECT?
LISA PETERSON: YES, THAT'S WHAT WAS DISCUSSED.
MR. WADE: OKAY. AND THAT WAS BEFORE YOU PREPARED THE MEMO THAT YOU REFERRED TO AFTER THE MEETING; CORRECT?
LISA PETERSON: CORRECT. BUT THE EARLIER MEMO WAS VERY MUCH WHAT WAS IN THE FINAL MEMO, WHICH WE HAD ALREADY DISCUSSED ON THE WAY THERE.
MR. WADE: OKAY. I WASN'T ASKING -- I'M NOT ASKING YOU ABOUT THE EARLIER MEMO. I'M ASKING YOU SPECIFIC QUESTIONS. OKAY?
LISA PETERSON: OKAY.
LISA PETERSON: YES.
LISA PETERSON: YES, FOUR HOURS WORTH.
LISA PETERSON: YES.
LISA PETERSON: YES.
LISA PETERSON: YES.
MR. WADE: AND BEFORE THAT COMMITMENT WAS EXPRESSED IN THAT MEETING, YOU DID NOT PROVIDE ANY INPUT IN A SIDE MEETING TO ANY OF THOSE INVESTMENT COMMITTEE MEMBERS OR TO MR. TUBERGEN THAT DAY, DID YOU?
LISA PETERSON: OTHER THAN THE THREE HOURS ON THE PLANE ON THE WAY THERE, NO.
MR. WADE: OKAY. IF WE CAN PULL UP 2098 WHICH I BELIEVE IS IN EVIDENCE AND GO TO THE SECOND PAGE. OKAY. LET ME KNOW WHEN YOU HAVE 2098, PAGE 2 IN FRONT OF YOU.
LISA PETERSON: OKAY.
LISA PETERSON: YES.
MR. WADE: OKAY. AND DO YOU RECALL LAST WEEK WE WENT THROUGH CERTAIN ASPECTS OF THIS EMAIL AND THERE WAS COMMUNICATION ABOUT THE FACT THAT, THAT YOU WERE NOT INCLUDED ON AND THEN YOU WERE LOOPED IN LATER. DO YOU RECALL THAT?
LISA PETERSON: SAY THAT AGAIN.
MR. WADE: LET ME JUST FOCUS ON THE DOCUMENT. DO YOU SEE THAT THERE WERE COMMUNICATIONS BETWEEN MS. HOLMES, MR. TUBERGEN, MR. BALWANI, AND DOUG DEVOS? DO YOU SEE THAT?
LISA PETERSON: YES, YES.
LISA PETERSON: YES.
MR. WADE: AND YOU SEE MR. TUBERGEN LOOPS YOU IN TO LET YOU -- TO KEEP YOU POSTED. DO YOU SEE THAT?
LISA PETERSON: YES.
MR. WADE: AND WE DIDN'T FOCUS ON IT, BUT IF YOU GO -- IF YOU LOOK AT THE BOTTOM OF THE FIRST PAGE, BOTTOM OF THE FIRST -- NOPE. THE HEADER JUST ON THE BOTTOM THERE, PLEASE. THANK YOU. DO YOU SEE THIS IS AN EMAIL FROM YOU TO MR. TUBERGEN ON OCTOBER 20TH; CORRECT?
LISA PETERSON: YES.
MR. WADE: AND LET'S LOOK AT THE EMAIL, WHICH IS ON THE TOP OF THE SECOND PAGE. AND DO YOU SEE THAT MR. TUBERGEN APOLOGIZES FOR HAVING FAILED TO INCLUDE YOU PREVIOUSLY. DO YOU SEE THAT?
LISA PETERSON: YES.
LISA PETERSON: YES.
MR. WADE: AND HE SAYS, "GOOD NEWS IS WE ARE IN AND I'M VERY ENCOURAGED BY THIS DEAL." DO YOU SEE THAT?
LISA PETERSON: YES.
LISA PETERSON: YES.
LISA PETERSON: YES.
MR. WADE: AND YOU SAY, "NO WORRIES. I'LL DOCUMENT SOMETHING FOR THE FILE THAT YOU CAN SIGN AS 'APPROVED.'" CORRECT?
LISA PETERSON: YES.
LISA PETERSON: YES.
MR. WADE: AND IF I CAN CALL YOUR ATTENTION TO THE LAST PAGE. THIS IS THE MEMO THAT WAS PREPARED FOR THE FILE AFTER THE MEETING; CORRECT?
LISA PETERSON: YES.
LISA PETERSON: YES.
LISA PETERSON: CORRECT.
LISA PETERSON: THIS WAS SENT TO JERRY ON THE 23RD OF OCTOBER, AND I HAVE SPECIFICALLY ASKED BACK, ARE WE OKAY TO MOVE FORWARD TO DOCUMENT THE DEAL, TO WHICH HE RESPONDED YES.
MR. WADE: RIGHT. DO YOU RECALL THAT WE JUST LOOKED AT THE EMAIL THAT SAID THAT YOU DOCUMENT SOMETHING FOR THE FILE; RIGHT?
LISA PETERSON: YES, YES.
LISA PETERSON: HE INFORMED ME THAT I WAS -- WE WERE IN, WHICH MEANT THAT SHE HAD ACCEPTED US INTO THIS DEAL. WE STILL HAD TO CLOSE IT.
MR. WADE: OKAY. THE -- I WANT TO CALL YOUR ATTENTION -- MY, MY -- THERE'S A BLANK FOR THE DATE AND THERE'S NO DATE IN THE BLANK; CORRECT?
LISA PETERSON: CORRECT.
MR. WADE: I WANT TO CALL YOUR ATTENTION TO THE SENTENCE IN THE MIDDLE OF THE PARAGRAPH THAT SAYS "FURTHERMORE." DO YOU SEE THAT?
LISA PETERSON: YES.
LISA PETERSON: YES.
MR. WADE: AND YOU TESTIFIED THAT YOU GOT THIS INFORMATION FROM MS. HOLMES AND MR. BALWANI. DO YOU RECALL THAT?
LISA PETERSON: SHE TALKED ABOUT THIS, YES.
MR. WADE: OKAY. ISN'T IT THE CASE THAT YOU ACTUALLY TOOK THIS LANGUAGE DIRECTLY OUT OF THE "FORTUNE" ARTICLE?
LISA PETERSON: WE ASKED ABOUT THIS BECAUSE WE WANTED TO KNOW WHY THEY DIDN'T HAVE TO HAVE FDA APPROVAL.
MR. WADE: OKAY. MY QUESTION IS, ISN'T IT THE CASE THAT YOU TOOK THIS LANGUAGE DIRECTLY OUT OF THE "FORTUNE" ARTICLE?
LISA PETERSON: BUT WE ASKED ABOUT IT AND GOT AN ANSWER AND THIS WAS WHAT THE ANSWER WAS.
LISA PETERSON: I DON'T KNOW.
JUDGE DAVILA: LISTEN TO HIS QUESTION AND HE'LL ASK YOU ONE MORE TIME.
LISA PETERSON: OKAY.
BY MR. WADE:
LISA PETERSON: IT MAY HAVE, BUT WE ASKED ABOUT IT SPECIFICALLY.
MR. WADE: OKAY. LET'S TAKE A LOOK AT EXHIBIT 1944. IF WE CAN DO THAT ON A SPLIT SCREEN. YEAH, IF WE CAN CALL UP PAGE ENDING 5014 IN THE BOTTOM CORNER, A DIFFERENT VERSION HERE. PAGE 69 OF THE ARTICLE. PAGE 6 OF 9. I'M SORRY. TOO MANY DIFFERENT PAGE NUMBERS. PAGE 6 OF 9. AND IF WE CAN BLOW UP THE PARAGRAPH STARTING WITH "THERANOS" IN THE LEFT-HAND COLUMN. ISN'T THAT ALMOST VERBATIM THE LANGUAGE OUT OF THE "FORTUNE" ARTICLE?
LISA PETERSON: YES. BUT AS I SAID, WE ASKED ABOUT THAT SPECIFICALLY AT THE MEETING. WE WANTED TO KNOW WHAT THE FDA REGULATIONS WERE, AND THAT WAS THE ANSWER THAT WE WERE GIVEN. AND THEN SHE TOLD US THAT THEY WERE MOVING TO DO FDA APPROVAL ON EVERY TEST.
LISA PETERSON: SHE SAID IT WASN'T NEEDED.
LISA PETERSON: BECAUSE THEY MADE THEIR OWN ANALYZER EQUIPMENT. THAT WAS THE ANSWER THAT SHE GAVE.
MR. WADE: RIGHT. AND IN ORDER FOR THEM TO DISTRIBUTE THEIR ANALYZER EQUIPMENT, THEY HAD TO GET FDA APPROVAL; CORRECT?
LISA PETERSON: THAT'S NOT WHAT THE -- SHE -- WE ASKED SPECIFICALLY, DO YOU NEED FDA APPROVAL? AND SHE SAID, NO, BECAUSE WE MAKE OUR OWN ANALYZER. AND THEN SHE SAID WE'RE GOING TO TAKE IT ONE STEP FURTHER AND APPROVE EVERY ONE OF OUR TESTS.
LISA PETERSON: YES.
LISA PETERSON: WE RELIED ON WHAT SHE SAID.
MR. WADE: THIS STATEMENT -- THE STATEMENT THAT WE'RE REFERRING TO COMES DIRECTLY OUT OF THE ARTICLE; RIGHT?
LISA PETERSON: YES.
LISA PETERSON: YES.
LISA PETERSON: YES.
LISA PETERSON: THEY TURNED INTO MY MEMO.
LISA PETERSON: THAT'S VERY TYPICAL FOR ME. I WRITE STUFF OUT, I TYPE UP A MEMO, AND I TOSS THE NOTES AND PUT THE MEMO IN THE FILE.
MR. WADE: LET ME CALL YOUR ATTENTION TO 10588. AND WHILE WE'RE BRINGING THAT UP, DO YOU RECALL PREVIOUSLY TELLING THE GOVERNMENT THAT YOU DIDN'T TAKE NOTES IN THAT MEETING APART FROM THE NOTES IN THE FINANCIAL STATEMENTS?
LISA PETERSON: I DON'T RECALL SAYING THAT, AND IT WAS A LONG MEETING. AND I DEFINITELY TOOK NOTES ON THE FINANCIALS, SO --
MR. WADE: RIGHT. SO DID YOU TAKE ANY -- DO YOU RECALL TELLING THE GOVERNMENT THAT YOU DIDN'T TAKE ANY NOTES OTHER THAN THE NOTES ON THE FINANCIAL STATEMENTS?
LISA PETERSON: I DON'T RECALL SAYING THAT. THE DETAILS IN THE MEMO CAME FROM THAT MEETING.
LISA PETERSON: YES.
LISA PETERSON: YES.
LISA PETERSON: YES.
LISA PETERSON: YES.
MR. WADE: OKAY. LET'S GO TO PAGE 7 OF THE DOCUMENT. THERE MAY BE A DIFFERENT VERSION OF THIS. I MOVE EXHIBIT 10588 INTO EVIDENCE. I THINK YOU WERE PREVIOUSLY SHOWN AN UNSIGNED VERSION.
MR. LEACH: NO OBJECTION, YOUR HONOR.
JUDGE DAVILA: 10588 IS ADMITTED, AND IT MAY BE PUBLISHED.
(DEFENDANT'S EXHIBIT 10588 WAS RECEIVED IN EVIDENCE.)
BY MR. WADE:
MR. WADE: AND JUST SO THE RECORD IS CLEAR, YOU RECALL THAT MR. LEACH SHOWED YOU I THINK A VERSION OF THIS DOCUMENT THAT WAS ATTACHED TO AN EMAIL?
LISA PETERSON: YES.
MR. WADE: AND DO YOU SEE THAT THIS DOCUMENT IS A VERSION THAT ON PAGE BATES LABELLED 6816 IS ACTUALLY SIGNED BY MS. HOLMES? IT'S ON THE SCREEN FOR YOU.
LISA PETERSON: OKAY. YES.
MR. WADE: OKAY. THE -- LET'S GO TO PAGE 7. LET'S GO TO PARAGRAPH 4.4. AND DO YOU SEE THERE THAT THERE'S AN ACKNOWLEDGEMENT BY RDV THAT THIS IS A SPECULATIVE INVESTMENT?
LISA PETERSON: YES.
MR. WADE: OKAY. AND IT NOTES SPECIFICALLY THAT THE COMPANY HAS LIMITED FINANCIAL AND OPERATING HISTORY. DO YOU SEE THAT?
LISA PETERSON: I SEE THE NOTE, YES.
MR. WADE: AND THAT AN INVESTMENT IN THE COMPANY IS HIGHLY SPECULATIVE AND IT INVOLVES SUBSTANTIAL RISKS. DO YOU SEE THAT?
LISA PETERSON: YES.
LISA PETERSON: IT DID. BUT WE ALSO RELIED ON WHAT WE HEARD.
JUDGE DAVILA: THE LAST COMMENT IS STRICKEN.
JUDGE DAVILA: YES. IT'S STRICKEN, YES.
LISA PETERSON: YES.
MR. WADE: OKAY. AND IT TALKS ABOUT HOW THE INVESTOR HAD AN OPPORTUNITY TO ASK QUESTIONS OF, RECEIVE ANSWER FROM, AND REVIEW WHATEVER MATERIALS IT FELT THAT IT NEEDED TO; CORRECT?
LISA PETERSON: YES.
MR. WADE: OKAY. AND IF YOU GO DOWN A FEW LINES, THERE'S A SENTENCE ON THE VERY RIGHT THAT STARTS WITH "SUCH." DO YOU SEE THAT? IT SAYS, "SUCH INVESTOR UNDERSTANDS THAT SUCH DISCUSSIONS, AS WELL AS ANY INFORMATION ISSUED BY THE COMPANY, WERE INTENDED TO DESCRIBE CERTAIN ASPECTS OF THE COMPANY'S BUSINESS AND PROSPECTS, BUT WERE NOT NECESSARILY A THOROUGH OR EXHAUSTIVE DESCRIPTION." DO YOU SEE THAT?
LISA PETERSON: YES.
LISA PETERSON: YES.
MR. WADE: OKAY. NOW, LET'S GO -- LET'S LOOK AT THE NEXT SENTENCE. DO YOU RECALL THAT THERE WAS A LOT OF DISCUSSION ABOUT PROJECTIONS; RIGHT?
LISA PETERSON: YES.
LISA PETERSON: YES.
MR. WADE: AND SO THERE CAN BE A FAIR AMOUNT OF UNCERTAINTY ASSOCIATED WITH THOSE PROJECTIONS; RIGHT?
LISA PETERSON: THERE CAN BE.
MR. WADE: OKAY. LET'S LOOK AT THE LANGUAGE HERE. DO YOU SEE WHERE IT SAYS THAT "SUCH INVESTOR ACKNOWLEDGES THAT ANY BUSINESS PLANS PREPARED BY THE COMPANY HAVE BEEN, AND CONTINUE TO BE, SUBJECT TO CHANGE." DO YOU SEE THAT?
LISA PETERSON: YES.
MR. WADE: AND THAT MEANS THAT WHEN YOU INVEST IN A COMPANY, YOU DON'T NECESSARILY GET TO MAKE ALL OF THE DECISIONS ABOUT HOW IT'S RUN ON A DAY-TO-TO BASIS; RIGHT?
LISA PETERSON: CORRECT.
LISA PETERSON: YES.
MR. WADE: OKAY. AND THEN IT SAYS IT SPECIFICALLY ADDRESSES PROJECTIONS. DO YOU SEE? AND IT SAYS, "ANY PROJECTIONS INCLUDED IN SUCH BUSINESS PLANS OR OTHERWISE ARE NECESSARILY SPECULATIVE IN NATURE, AND IT CAN BE EXPECTED THAT SOME OR ALL OF THE ASSUMPTIONS UNDERLYING THE PROJECTIONS WILL NOT MATERIALIZE OR WILL VARY SIGNIFICANTLY FROM ACTUAL RESULTS." DO YOU SEE THAT?
LISA PETERSON: WE WERE SITTING IN AN OFFICE IN MID-OCTOBER WITH 150 MILLION OF REVENUE ON THE BOOKS AND A BREAK EVEN CASH FLOW. IF THERE WAS -- IF THEY WERE GOING TO END WILDLY DIFFERENT FROM THAT, THEY SHOULD HAVE SAID SO. THERE WERE TWO MONTHS TO GO IN THE YEAR.
JUDGE DAVILA: MS. PETERSON, I'M GOING TO ASK MR. WADE TO REPEAT HIS QUESTION AGAIN, AND THEN JUST PLEASE LISTEN TO HIS QUESTION AND SEE IF YOU CAN ANSWER.
LISA PETERSON: OKAY.
BY MR. WADE:
MR. WADE: OKAY. DO YOU SEE HERE IN THE AGREEMENT THAT RDV SIGNED WITH THE COMPANY THAT SAYS, "IT CAN BE EXPECTED THAT SOME OR ALL OF THE ASSUMPTIONS UNDERLYING THE PROJECTIONS WILL NOT MATERIALIZE OR WILL VARY SIGNIFICANTLY FROM THE ACTUAL RESULTS"? DO YOU SEE THAT?
LISA PETERSON: YES, I SEE THAT.
LISA PETERSON: YES.
MR. WADE: OKAY. AND DO YOU SEE BELOW IT -- I'M DONE WITH THIS PARAGRAPH. DO YOU SEE IN 4.6 IT REFERS TO AN ACCREDITED INVESTOR?
LISA PETERSON: YES.
MR. WADE: OKAY. AND YOU KNOW THERE ARE SPECIAL RULES THAT APPLY TO ACCREDITED INVESTORS? ARE YOU AWARE OF THAT?
LISA PETERSON: YES.
MR. WADE: AND AS A GENERAL MATTER, IS IT FAIR TO SAY THAT THESE ARE -- THIS IS A CERTIFICATION THAT YOU'RE SLIGHTLY MORE SOPHISTICATED THAN A BEGINNING INVESTOR?
LISA PETERSON: YES.
LISA PETERSON: YES.
MR. WADE: OKAY. AND THAT'S BECAUSE SOME -- FOR CERTAIN KINDS OF TRANSACTIONS, THEY'RE COMPLICATED; RIGHT?
LISA PETERSON: YES.
MR. WADE: AND BOTH PARTIES WANT TO ASSURE THAT THERE'S A LEVEL OF SOPHISTICATION THAT EXISTS SO THAT PEOPLE UNDERSTAND THINGS; RIGHT?
LISA PETERSON: YES.
LISA PETERSON: YES.
LISA PETERSON: BUT YOU'RE TRYING TO MEASURE OUR SOPHISTICATION AS AN INVESTOR WHEN WE WEREN'T GIVEN COMPLETE INFORMATION.
JUDGE DAVILA: THAT LAST PORTION IS STRICKEN. AND, MS. PETERSON, JUST WAIT FOR HIS QUESTIONS AND THEN YOU CAN ANSWER HIS QUESTIONS, PLEASE.
LISA PETERSON: OKAY.
LISA PETERSON: YES.
MR. WADE: AND THAT TALKS ABOUT HOW, "THIS AGREEMENT, INCLUDING THE EXHIBITS ATTACHED HERETO, CONSTITUTE THE FULL AND ENTIRE UNDERSTANDING AND AGREEMENT AMONG THE PARTIES WITH REGARD TO ANY SUBJECTS HEREOF AND SUPERSEDE ANY PRIOR AGREEMENTS OR UNDERSTANDINGS WITH RESPECT TO THE SUBJECT MATTER HEREOF." DO YOU SEE THAT?
LISA PETERSON: YES.
LISA PETERSON: YES.
LISA PETERSON: YES, ON BEHALF OF DYNASTY II.
LISA PETERSON: YES.
MR. WADE: AND SO JUST A COUPLE OF MORE QUESTIONS TO MAKE SURE THAT I AM CLEAR. WITHIN RDV, MR. TUBERGEN ORIGINATED THIS INVESTMENT; CORRECT?
LISA PETERSON: YES.
LISA PETERSON: YES.
LISA PETERSON: YES, TO THE MEMBERS OF THE G2.
MR. WADE: AND IT WAS THOSE MEMBERS OF THE INVESTMENT COMMITTEE THAT WERE EMPOWERED TO MAKE THE DECISION TO MAKE AN INVESTMENT ON BEHALF OF RDV; CORRECT?
LISA PETERSON: YES.
MR. WADE: OKAY. AND ULTIMATELY THEY'RE THE ONES WHO MADE THAT DECISION IN CONSULTATION WITH MR. TUBERGEN; RIGHT?
LISA PETERSON: YES.
MR. WADE: AND THE PEOPLE WHO MADE THE DECISION WERE RICK DEVOS, DOUG DEVOS, DAN DEVOS, AND DICK DEVOS; CORRECT?
LISA PETERSON: YES.
JUDGE DAVILA: MR. LEACH, REDIRECT?
MR. LEACH: YES, YOUR HONOR. THANK YOU.
(PAUSE IN PROCEEDINGS.)
MR. LEACH: MAY I INQUIRE, YOUR HONOR?
JUDGE DAVILA: YES, THANK YOU.
REDIRECT EXAMINATION BY MR. LEACH:
MR. LEACH: GOOD MORNING, MS. PETERSON. WELCOME BACK.
LISA PETERSON: GOOD MORNING.
MR. LEACH: LET ME START WHERE MR. WADE CONCLUDED, WITH SOME QUESTIONS ABOUT THE LEGAL DOCUMENTS THAT RDV SIGNED IN CONNECTION WITH THE INVESTMENT, AND I THINK HE WALKED THROUGH SOME LANGUAGE THAT THE GOVERNMENT HAD ALSO GONE THROUGH ABOUT RDV'S ACCREDITED INVESTMENT STATUS AND THE NATURE OF THE INVESTMENT. DO YOU RECALL THAT TESTIMONY?
LISA PETERSON: YES.
MR. LEACH: AND HE SHOWED YOU SOME LANGUAGE ABOUT THIS BEING THE ENTIRE AGREEMENT. DID YOU UNDERSTAND THAT TO MEAN THAT ANYTHING THAT MS. HOLMES OR MR. BALWANI HAD SAID TO RDV TO INDUCE THE INVESTMENT WAS, THEREFORE, NOT SOMETHING THAT YOU COULD RELY ON?
MR. LEACH: WHAT DID YOU UNDERSTAND THAT ENTIRE AGREEMENT LANGUAGE TO MEAN?
LISA PETERSON: ANYTHING THAT WAS --
JUDGE DAVILA: I DON'T THINK IT'S A 702 ISSUE. I THINK THERE WAS A LOT OF QUESTIONING ABOUT HER, WHAT SHE DID FOR THE COMPANY. I THINK WE KNOW THAT. AND I DO THINK IT IS APPROPRIATE FOR HER TO ANSWER THE FULSOMENESS OF WHAT SHE DID. SO I'M GOING TO OVERRULE THE OBJECTION.
BY MR. LEACH:
MR. LEACH: WHAT WAS YOUR UNDERSTANDING, MS. PETERSON?
LISA PETERSON: EVERYTHING THAT WAS SAID TO US WE BELIEVE IS FAIR GAME FOR US TO MAKE OUR INVESTMENT DECISION ON AND WHAT WE RELIED ON, NOT JUST WHAT WE READ IN WRITING, BUT ALSO WHAT WE WERE TOLD.
MR. LEACH: WAS THERE ANYTHING IN THE DOCUMENT THAT YOU SAW THAT SAID RDV SHOULD NOT RELY ON THE VERBAL REPRESENTATIONS BY MS. HOLMES OR THE WRITTEN MATERIALS THAT YOU RECEIVED?
MR. LEACH: OKAY. HE ALSO ASKED YOU SOME QUESTIONS ABOUT THE PROJECTIONS THAT WERE PROVIDED TO RDV, AND YOU UNDERSTAND THE PROJECTIONS ARE FORWARD LOOKING; CORRECT?
LISA PETERSON: YES.
MR. LEACH: AND YOU HAD -- AND YOU REVIEWED THOSE PROJECTIONS CAREFULLY; CORRECT?
LISA PETERSON: YES.
MR. LEACH: DID YOU IN ANY WAY DREAM THAT THERANOS WOULD HAVE -- AND YOU RECALL THE PROJECTIONS WERE FOR 140 MILLION --
LISA PETERSON: YES.
MR. LEACH: -- IN 2014? I THINK YOU VOLUNTEERED THAT NUMBER?
LISA PETERSON: YES.
MR. LEACH: DID YOU IN ANY WAY DREAM THE REVENUE FOR THAT YEAR WOULD BE ZERO?
MR. LEACH: DID YOU IN ANY WAY DREAM THAT THE REVENUE IN 2015 WOULD BE LESS THAN $500,000?
MR. LEACH: OKAY. AND IT SEEMED LIKE YOU WANTED TO EXPLAIN WHY EVEN THOUGH THESE ARE FORWARD LOOKING, YOU WERE STILL SURPRISED BY NOT HITTING THE PROJECTIONS. CAN YOU EXPLAIN?
LISA PETERSON: PROJECTIONS, IS N OUR WORLD, THEY SHOULD BE SOMEWHAT CLOSE. THERE'S DEFINITE RISK IN ACCEPTING PROJECTIONS. BUT WE WERE TOLD THERE WAS 900 WAL-MART -- OR WALGREENS STORES THAT WERE GOING TO OPEN THAT BACKED UP THE PROJECTIONS FOR THE NEXT YEAR, ALONG WITH 300 SAFEWAY STORES. IT WAS THAT THAT WE USED TO BASE OUR THOUGHT AROUND THE PROJECTIONS, COULD THEY REACH THAT NUMBER. EVEN IF THEY DIDN'T REACH THE $990 MILLION THAT THEY SAID THEY WERE GOING TO DO FOR THE NEXT YEAR, EVEN IF THEY HAD REACHED 300 MILLION, THAT WOULD HAVE BEEN A SUCCESSFUL DEAL FOR US. THEY WERE MOVING THE BALL FORWARD. BUT THE FACT THAT THEY JUST DID ZERO TELLS US THAT WHAT THEY WERE TELLING US WASN'T TRUE.
MR. LEACH: YOU WERE ALSO ASKED A NUMBER OF QUESTIONS ABOUT THE "FORTUNE" ARTICLE THAT YOU WERE PROVIDED AT SOME POINT IN SEPTEMBER OF '14.
LISA PETERSON: YES.
MR. LEACH: DO YOU RECALL THAT TESTIMONY?
LISA PETERSON: YES.
MR. LEACH: AND IF I COULD -- AND YOU WERE ASKED -- YOU GOT INFORMATION FROM THE "FORTUNE" ARTICLE, FROM OTHER PUBLIC SOURCES, FROM A CONVERSATION WITH MS. HOLMES, AND A MEETING WITH MS. HOLMES AND MR. BALWANI IN PALO ALTO. IS THAT A FAIR SUMMARY?
LISA PETERSON: YES.
MR. LEACH: OKAY. LET ME DRAW YOUR ATTENTION TO EXHIBIT 455, OR 4858.
LISA PETERSON: OKAY.
MR. LEACH: DO YOU RECALL THIS TO BE THE POWERPOINT DECK AMONG THE INVESTMENT MATERIALS THAT THERANOS PROVIDED TO RDV?
LISA PETERSON: YES.
MR. LEACH: LET ME DRAW YOUR ATTENTION, PLEASE, TO PAGE 49. AND IF WE COULD PLEASE DISPLAY THIS, MS. HOLLIMAN. DO YOU SEE THE FIRST PAGE OF THIS SLIDE DECK ON THE SCREEN, MS. PETERSON?
LISA PETERSON: YES.
MR. LEACH: AND IF WE COULD PLEASE GO TO PAGE 49. DO YOU SEE THE TITLE "RECENT PRESS"?
LISA PETERSON: YES.
MR. LEACH: AND DO YOU SEE TO THE RIGHT AN IMAGE OF MS. HOLMES UNDERNEATH THE HEADING "FORTUNE," "THIS CEO IS OUT FOR BLOOD"?
LISA PETERSON: YES.
MR. LEACH: AND DID YOU UNDERSTAND THIS TO BE THERANOS REFERRING YOU TO THIS SPECIFIC ARTICLE AS PART OF THE UNIVERSE OF INFORMATION THAT YOU SHOULD CONSIDER?
LISA PETERSON: YES.
MR. LEACH: IN YOUR MEETING IN PALO ALTO WITH MS. HOLMES, DID YOU ASK HER QUESTIONS ABOUT SOME OF THE FACTS THAT WERE ASSERTED IN THE ARTICLE?
LISA PETERSON: YES.
MR. LEACH: AND AT ANY POINT IN TIME, DID SHE SAY, DON'T RELY ON THAT PIECE OF INFORMATION FROM THE PARLOFF ARTICLE, THAT'S NOT RIGHT?
LISA PETERSON: NEVER, NO.
MR. LEACH: DID SHE SAY ANYTHING TO THE EFFECT OF THAT LINE ABOUT THIRD PARTY -- US NOT USING THIRD PARTY DEVICES, THAT'S NOT RIGHT, LET ME CORRECT YOUR UNDERSTANDING THERE?
MR. LEACH: SHE HELD THAT OUT AS SOMETHING YOU SHOULD RELY ON; IS THAT FAIR?
LISA PETERSON: YES.
MR. LEACH: YOU WERE ALSO ASKED A NUMBER OF QUESTIONS ABOUT FORWARD-LOOKING STATEMENTS IN THE POWERPOINT. AND I THINK MR. WADE ASKED YOU ABOUT PAGE 19. IF WE COULD DISPLAY THAT. AND DO YOU SEE THERE TO BE SOME COST SAVINGS ESTIMATES FROM 2014 TO 2023 IN THE LEFT GRAPH, AND THEN THE SAME PERIOD IN THE RIGHT GRAPH?
LISA PETERSON: YES.
MR. LEACH: AND YOU UNDERSTOOD AT THE TIME THAT THESE WERE FORWARD LOOKING PROJECTIONS?
LISA PETERSON: YES.
MR. LEACH: AND DO YOU SEE WHERE IT SAYS, FOR 2014, THERE'S AN E AFTER THAT?
LISA PETERSON: YES.
MR. LEACH: AND THAT E CONTINUES ALL OF THE WAY OUT TO 2023. DO YOU SEE THAT?
LISA PETERSON: YES.
MR. LEACH: AND IS THAT WHAT HELPED YOU UNDERSTAND THAT THESE WERE FORWARD-LOOKING STATEMENTS?
LISA PETERSON: YES.
MR. LEACH: AND THE E STANDS FOR ESTIMATE?
LISA PETERSON: YES, AND THOSE YEARS HADN'T HAPPENED YET.
MR. LEACH: OKAY. SO THERE WAS INFORMATION ON THIS SLIDE THAT TOLD YOU THAT THIS SLIDE WAS FORWARD LOOKING?
LISA PETERSON: YES.
MR. LEACH: AND MR. WADE ALSO SHOWED YOU PAGE 20. IF WE CAN PLEASE LOOK AT THAT. IS THIS ANOTHER EXAMPLE WHERE THE USE OF E'S NEXT TO FUTURE TIME PERIODS INDICATED TO YOU THAT THIS WAS SLIDE WAS FORWARD LOOKING?
LISA PETERSON: YES.
MR. LEACH: AND I THINK MR. WADE ALSO SHOWED YOU PAGE 40. DO YOU SEE WHERE IT SAYS, "THERANOS'S FOOTPRINT UPON NATIONAL DEPLOYMENT"?
LISA PETERSON: YES.
MR. LEACH: AND YOU UNDERSTOOD "UPON" TO REFER TO SOMETHING THAT WOULD HAPPEN IN THE FUTURE?
LISA PETERSON: YES.
MR. LEACH: LET ME SHOW YOU SOME OTHER SLIDES. IF WE COULD GO, PLEASE, TO PAGE 3. AND IN THE FIRST SUBSTANTIVE PARAGRAPH IT SAYS, "THERANOS'S PROPRIETARY, PATENTED TECHNOLOGY RUNS COMPREHENSIVE BLOOD TESTS FROM A FINGERSTICK." DO YOU SEE THAT?
LISA PETERSON: YES.
MR. LEACH: AND I WANT TO FOCUS ON THE WORD "RUNS." DID YOU UNDERSTAND THAT TO BE THE PRESENT TENSE?
LISA PETERSON: YES.
MR. LEACH: AND DID YOU UNDERSTAND THAT TO BE FORWARD LOOKING?
MR. LEACH: DOES THIS SAY "WILL IN THE FUTURE RUN"?
LISA PETERSON: IT SAYS THEY'RE DOING IT NOW AND WILL CONTINUE TO DO IT IN THE FUTURE, YES.
MR. LEACH: AND THAT'S WHAT YOU UNDERSTOOD AT THE TIME?
LISA PETERSON: YES.
MR. LEACH: IF WE COULD LOOK, PLEASE, AT -- OH, AND IN THE THIRD PARAGRAPH IT SAYS, "CURRENT AND PAST CLIENTS INCLUDE 10 OF THE TOP 15 MAJOR PHARMACEUTICAL COMPANIES, MIDSIZED BIO-PHARMAS, PROMINENT RESEARCH INSTITUTIONS, HEALTH CARE PAYORS, AND U.S. AND FOREIGN GOVERNMENT HEALTH AND MILITARY ORGANIZATIONS." DO YOU SEE THAT LANGUAGE?
LISA PETERSON: YES.
MR. LEACH: AND YOU UNDERSTOOD THESE TO BE STATEMENTS ABOUT WHAT WAS CURRENT AND WHAT HAPPENED IN THE PAST; IS THAT RIGHT?
LISA PETERSON: YES.
MR. LEACH: AND SO WHEN YOU TESTIFIED THAT MS. HOLMES TOLD YOU THAT THERANOS WAS USING THE ANALYZER ON MILITARY HELICOPTERS --
LISA PETERSON: YES.
MR. LEACH: -- YOU THOUGHT THAT THAT WAS SOMETHING THAT THERANOS HAD DONE?
LISA PETERSON: YES.
MR. LEACH: LET'S LOOK AT PAGE 7, PLEASE. DO YOU RECALL TESTIFYING ABOUT THE PROFICIENCY TESTING RESULTS THAT THERANOS HELD OUT TO YOU?
LISA PETERSON: YES.
MR. LEACH: AND YOU BELIEVED THAT THESE WERE PROFICIENCY TESTING RESULTS THAT WERE ACHIEVED IN THE PAST, NOT SOMETHING THAT WAS GOING TO HAPPEN IN THE FUTURE; CORRECT?
LISA PETERSON: CORRECT, BASED ON THE DATES.
MR. LEACH: AND YOU BELIEVED THESE PROFICIENCY TESTING RESULTS RELATED TO THE ANALYZER THAT YOU HAD SEEN?
LISA PETERSON: YES.
MR. LEACH: OKAY. NOBODY TOLD YOU THAT THERANOS WASN'T USING THE ANALYZER IN THE CLIA LAB IN 2011?
MR. LEACH: AND NO ONE TOLD YOU THAT THERANOS WAS NOT USING THE ANALYZER IN THE CLIA LAB IN 2012?
MR. LEACH: OR 2013?
MR. LEACH: LET ME DRAW YOUR ATTENTION TO PAGE 8. DO YOU SEE WHERE IT SAYS, "THERANOS HAS BEEN COMPREHENSIVELY VALIDATED OVER THE COURSE OF THE LAST SEVEN YEARS BY TEN OF THE FIFTEEN LARGEST PHARMACEUTICAL COMPANIES"?
LISA PETERSON: YES.
MR. LEACH: AND DID YOU UNDERSTAND THAT TO BE A STATEMENT OF WHAT HAD HAPPENED IN THE PAST?
LISA PETERSON: YES.
MR. LEACH: NOT SOMETHING THAT WAS FORWARD LOOKING?
LISA PETERSON: CORRECT, AND IT'S PERMANENTLY IN MY MEMO.
MR. LEACH: AND LET ME DRAW YOUR ATTENTION, PLEASE, TO PAGE 28. DO YOU SEE WHERE IT SAYS, "THERANOS RUNS ANY TEST AVAILABLE IN CENTRAL LABS"?
LISA PETERSON: YES.
MR. LEACH: AND RUNS AS IN THE PRESENT TENSE?
LISA PETERSON: YES.
MR. LEACH: NOT IN THE FUTURE TENSE?
LISA PETERSON: CORRECT.
MR. LEACH: AND THAT'S SOMETHING THAT YOU UNDERSTOOD THERANOS WAS DOING AT THE TIME?
LISA PETERSON: YES.
MR. LEACH: MR. WADE ALSO ASKED YOU ABOUT THAT LANGUAGE AT THE END, "PROCESSES ALL SAMPLE TYPES." DID YOU THINK THAT THAT REFERRED TO SAMPLES SUCH AS URINE OR BLOOD OR SOME OTHER MATRIX?
JUDGE DAVILA: ASKING HER UNDERSTANDING, YES, SUSTAINED.
BY MR. LEACH:
MR. LEACH: WHAT WAS YOUR UNDERSTANDING OF WHAT THAT MEANT?
LISA PETERSON: I TOOK IT TO MEAN THAT IT PROCESSES ALL TYPES OF SAMPLES THAT CAN DO ALL TYPES OF TESTS.
MR. LEACH: OKAY. DID YOU IN ANY WAY THINK THAT IT RELATED TO VENOUS DRAWS?
MR. LEACH: DID MS. HOLMES EVER EXPLAIN TO YOU THAT WE -- WHEN WE SAID THAT LANGUAGE, WE MEANT VENOUS DRAWS?
LISA PETERSON: NO, WE DIDN'T HEAR THAT UNTIL THE "JOURNAL" ARTICLE.
MR. LEACH: DID THE IDEA OF THE VENOUS DRAWS EVER COME UP IN YOUR CONVERSATIONS WITH MS. HOLMES?
MR. LEACH: MR. WADE ASKED YOU A NUMBER OF QUESTIONS ABOUT 14212. IF I COULD USE THE ELMO FOR THIS, MS. KRATZMANN.
COURT CLERK: YES.
BY MR. LEACH:
MR. LEACH: DO YOU RECALL BEING ASKED QUESTIONS ABOUT THIS DOCUMENT, MS. PETERSON?
LISA PETERSON: YES.
MR. LEACH: AND CAN YOU GIVE US THE CONTEXT FOR WHAT THIS IS?
LISA PETERSON: SO THIS IS BOB AND OUR CFO AND OUR CONTROLLER JUST TRYING TO UNDERSTAND WHERE THE FAMILY STANDS WITH FREE CASH AT THE MOMENT, BECAUSE I'M SURE THERE WERE LOTS OF OTHER INVESTMENTS, INCLUDING THIS ONE THAT WE'RE LOOKING AT, AND WE'RE CONSTANTLY TRYING TO CASH FLOW PLAN WHEN AND WHAT IS COMING. IT DOESN'T MEAN ANYTHING MORE THAN THAT IT COULD HAPPEN.
MR. LEACH: WHEN YOU SAY, "IT DOESN'T MEAN ANYTHING MORE THAN WHAT COULD HAPPEN," WHAT DO YOU MEAN BY THAT?
LISA PETERSON: THEY NEED TO BE PREPARED IF WE WERE TO DO SOMETHING LIKE THIS, BUT IT DOESN'T MEAN THAT WE WERE DOING IT.
MR. LEACH: DOES THAT MEAN IN YOUR MIND ANYTHING THAT YOU LEARN IN YOUR SUBSEQUENT DILIGENCE OR OUT IN THE MEETING IN PALO ALTO HAD NO RELEVANCE TO YOU?
LISA PETERSON: THAT'S NOT IT AT ALL, NO. WE COULD HAVE LEARNED SOMETHING THAT WOULD HAVE STOPPED THAT INVESTMENT, YES.
MR. LEACH: OKAY. MR. WADE ALSO ASKED YOU SOME QUESTIONS ABOUT 14076. DO YOU RECALL BEING ASKED QUESTIONS ABOUT THIS LETTER?
LISA PETERSON: YES.
MR. LEACH: AND YOUR MEMORY IS THAT THIS IS THE LETTER THAT ACCOMPANIED THE BINDERS OF MATERIALS THAT YOU REVIEWED?
LISA PETERSON: YES.
MR. LEACH: OKAY. AND MR. WADE WAS ASKING YOU QUESTIONS ABOUT THE PARAGRAPH BEGINNING "ONCE THE COMPANY WAS READY." YOU WANTED TO FOCUS ON THE THIRD PARAGRAPH, "HISTORICALLY, THERANOS'S WORK WAS FOCUSSED ON CONTRACTS WITH PHARMACEUTICAL AND MILITARY CLIENTS." DO YOU RECALL BEING ASKED QUESTIONS ABOUT THE FIFTH PARAGRAPH?
LISA PETERSON: YES.
MR. LEACH: OKAY. AND WHAT WAS IT YOU WANTED TO SAY ABOUT THE THIRD PARAGRAPH?
LISA PETERSON: THAT THEY HAD BEEN DOING WORK IN THE PAST, THAT SHE'S SAYING IT RIGHT THERE IN HER LETTER, AND THAT WAS IMPORTANT TO US. WE REALLY RELIED ON THE FACT THAT THEY HAD BEEN DOING WORK FOR PHARMACEUTICAL COMPANIES AND THE GOVERNMENT FOR YEARS.
MR. LEACH: I ALSO WANTED TO DRAW YOUR ATTENTION TO THE LAST PARAGRAPH WHERE IT SAYS, "I AM HAPPY TO PROVIDE MORE BACKGROUND ON ANY OF THE ABOVE, OR ANY OF THE MATERIALS ENCLOSED IN THIS PACKAGE. THERANOS'S INVESTMENT DOCUMENTS ARE ENCLOSED HEREIN. THE ADDITIONAL MATERIALS FOCUS ON THE INFRASTRUCTURE THERANOS HAS DEVELOPED AND THE INITIAL MARKET OF COMMERCIAL LABORATORY TESTING." DO YOU SEE THAT LANGUAGE?
LISA PETERSON: YES.
MR. LEACH: AND DID YOU UNDERSTAND THAT TO BE MS. HOLMES REFERRING YOU TO THE FOOT OF MATERIALS THAT RDV HAD RECEIVED?
LISA PETERSON: YES.
MR. LEACH: YOU WERE ALSO ASKED SOME QUESTIONS ABOUT THE -- YOU WERE ALSO ASKED QUESTIONS ABOUT A DOCUMENT WITH THE PFIZER LOGO. AND IF WE CAN CALL THAT UP AT EXHIBIT 4858, PAGE 1 OF 6, MS. HOLLIMAN. AND IF WE CAN GO TO PAGE -- I'M SORRY, PLEASE GO TO PAGE 129. DO YOU RECALL BEING ASKED QUESTIONS ABOUT THIS DOCUMENT?
LISA PETERSON: YES.
MR. LEACH: AND AT THE TIME YOU REVIEWED THIS, YOU WERE NOT A SCIENTIST?
LISA PETERSON: CORRECT.
MR. LEACH: OKAY. YOU WERE RELYING ON THE HIGH LEVEL CONCLUSIONS OF THE DOCUMENT?
LISA PETERSON: YES.
MR. LEACH: AND YOU BELIEVED THESE TO BE THE CONCLUSIONS OF PFIZER, NOT THERANOS?
LISA PETERSON: YES.
MR. LEACH: DID THE FACT THAT THE THERANOS ADDRESS WAS LISTED ON PAGES OF THE DOCUMENT IN ANY WAY CHANGE YOUR MIND ABOUT THAT?
LISA PETERSON: NO, NOT WHEN PFIZER'S LOGO IS ON THE PAGE.
MR. LEACH: OKAY. AND YOU DO NOT MAKE REFERENCE TO THE PFIZER REPORT ITSELF IN THE RDV APPROVAL DOCUMENT. WHY IS THAT?
LISA PETERSON: BECAUSE WE THOUGHT IT WAS ONE OF MANY PHARMACEUTICAL COMPANIES THAT THEY WORKED WITH. IT WAS, IT WAS THE TOTALITY OF DOING WORK FOR 10 OUT OF THE 15 LARGEST PHARMACEUTICAL COMPANIES THAT WE RELIED ON, THAT THEIR ANALYZER HAD BEEN TESTED AND WORKED FOR THOSE COMPANIES IN THEIR CLINICAL TRIALS.
MR. LEACH: AND IF IT WERE THE CASE THAT THESE WERE NOT THE CONCLUSIONS OF PFIZER, WOULD THAT HAVE BEEN RELEVANT TO YOU?
LISA PETERSON: YES.
MR. LEACH: OKAY. HOW SO?
LISA PETERSON: WE, WE WANTED -- THERE'S, THERE'S A COUPLE OF THINGS THAT WE REALLY RELIED ON, AND ONE OF THE BIGGEST THINGS WAS THE FACT THAT THIRD PARTY PHARMACEUTICAL COMPANIES AND THE GOVERNMENT WAS USING THE ANALYZER IN THE FIELD.
(PAUSE IN PROCEEDINGS.)
JUDGE DAVILA: PARDON ME. IT APPEARS THAT SOMEONE MAY BE TAKING PHOTOGRAPHS. LET'S TAKE OUR BREAK NOW. LET'S TAKE OUR BREAK, LADIES AND GENTLEMEN. I'M GOING TO TAKE A 30 MINUTE BREAK AND WE'LL COME BACK IN 30 MINUTES.
MR. LEACH: THANK YOU, YOUR HONOR.
(JURY OUT AT 10:43 A.M.)
JUDGE DAVILA: YOU CAN STAND DOWN, MS. PETERSON. THANK YOU. PLEASE BE SEATED, LADIES AND GENTLEMEN. ALL RIGHT. THANK YOU. THE RECORD SHOULD REFLECT THAT OUR JURY HAS LEFT, THE WITNESS HAS LEFT THE COURTROOM. A GENTLEMAN WHO IS STANDING BY THE BACK DOOR THERE, SIR, WHY DON'T YOU JUST COME UP TO THE FRONT HERE, IF YOU WOULD, PLEASE. THANK YOU. YOU CAN STAND THERE. SIR, IT COMES TO MY ATTENTION THAT YOU TOOK A PHOTOGRAPH INSIDE OF THIS COURTROOM, AND MY COURTROOM DEPUTY INFORMS ME THAT SHE TALKED WITH YOU ABOUT THIS AND THAT SHE ASKED YOU TO DELETE THE PHOTOGRAPH. IS THAT WHAT HAPPENED, SIR?
SPECTATOR: THAT'S CORRECT.
JUDGE DAVILA: SIR, DID YOU SEE THE SIGNS OUT FRONT OF THE COURTHOUSE HERE AND THE COURTROOM?
SPECTATOR: I DID NOT. I APOLOGIZE.
JUDGE DAVILA: THERE'S A SIGN THERE. I'LL INVITE YOUR ATTENTION TO IT, SIR. IT INDICATES THAT THERE IS NO RECORDING, NOR IS THERE PHOTO PHOTOGRAPHY OR VIDEO RECORDING OF THESE PROCEEDINGS OF ANY, ANY TYPE. DO YOU UNDERSTAND THAT, SIR?
SPECTATOR: I DO.
JUDGE DAVILA: DO YOU HAVE ANY QUESTION ABOUT THAT THAT YOU WANT TO ASK ME ABOUT?
SPECTATOR: NO, YOUR HONOR. THANK YOU.
JUDGE DAVILA: SIR, IT'S NOT PERMITTED, AND YOU MAY NOT DO THAT. IF IT COMES TO MY ATTENTION AGAIN, I'LL HAVE TO TAKE SOME ACTION. I WON'T, BUT I'LL SUMMON THE PEOPLE WHO ARE RESPONSIBLE. THEY'RE CALLED THE UNITED STATES MARSHAL, AND THEY'LL TAKE WHATEVER ACTION THAT THEY FEEL APPROPRIATE. DO YOU UNDERSTAND THAT, SIR?
SPECTATOR: UNDERSTOOD.
JUDGE DAVILA: ALL RIGHT. THANK YOU VERY MUCH, SIR. ANYTHING FURTHER BEFORE WE TAKE OUR BREAK?
MR. DOWNEY: NOT FROM US, YOUR HONOR.
MR. LEACH: NO, YOUR HONOR.
JUDGE DAVILA: ALL RIGHT. THANK YOU.
(RECESS FROM 10:46 A.M. UNTIL 11:22 A.M.)
(JURY IN AT 11:23 A.M.)
JUDGE DAVILA: PLEASE BE SEATED. WE'RE BACK ON THE RECORD. OUR JURY IS PRESENT. COUNSEL AND MS. HOLMES ARE PRESENT. THE WITNESS IS BACK ON THE STAND. MR. WADE -- EXCUSE ME, MR. LEACH, DO YOU WANT TO CONTINUE WITH YOUR EXAMINATION?
MR. LEACH: BRIEFLY, YOUR HONOR. THANK YOU.
JUDGE DAVILA: THERE WAS A PENDING OBJECTION BEFORE WE WERE INTERRUPTED. IT WAS BY MR. WADE ON 602 GROUNDS IN RESPONSE TO THE QUESTION. THE QUESTION WAS ASKING A FOLLOW-UP QUESTION OF HOW SO, THAT IS, THIS -- MS. PETERSON'S COMMENT ON PHARMACEUTICAL COMPANIES. I'M GOING TO OVERRULE THE OBJECTION. SHE CAN ANSWER THE QUESTION. WHY DON'T YOU ASK THE QUESTION AGAIN, MR. LEACH.
BY MR. LEACH:
MR. LEACH: I BELIEVE WE WERE ASKING QUESTIONS, MS. PETERSON, ABOUT THE PFIZER REPORT AS YOU UNDERSTOOD IT AND WHAT WAS MEANINGFUL TO YOU IN CONNECTION WITH CONSIDERATION OF THE INVESTMENT, AND IF YOU CAN JUST EXPLAIN YOUR THINKING FOR US, PLEASE?
LISA PETERSON: SURE. THE PFIZER REPORT IN THERE WAS IMPORTANT -- WAS VERY IMPORTANT TO US, BUT IT ALSO WAS ONE OF MANY THAT WE WERE RELYING ON. THE STATEMENT OF THEY WORKED FOR 10 OF THE TOP 15 WAS SUPER IMPORTANT TO US. IT LENDED CREDIBILITY TO THE ANALYZER WORKING, AND IT WAS AN OUTSIDE INDEPENDENT THIRD PARTY THAT HAD DONE WORK WITH THE ANALYZER AND THAT IT WORKED.
MR. LEACH: YOU ALSO WERE ASKED QUESTIONS ABOUT A COMPANY CALLED BDT. DO YOU REMEMBER BEING ASKED ABOUT BDT?
LISA PETERSON: YES.
MR. LEACH: AND WHAT IS BDT AGAIN?
LISA PETERSON: BDT IS A PRIVATE EQUITY FIRM RUN BY BYRON TROTT.
MR. LEACH: DO YOU KNOW WHETHER BDT INVESTED IN THERANOS?
MR. LEACH: DO YOU KNOW WHETHER BDT EVER CONSIDERED MAKING AN INVESTMENT IN THERANOS?
LISA PETERSON: YES, THEY DID.
MR. LEACH: AND YOU WERE ALSO ASKED SOME QUESTIONS ABOUT WHETHER OR NOT YOU VISITED A WALGREENS. DO YOU RECALL BEING ASKED THOSE QUESTIONS?
LISA PETERSON: YES.
MR. LEACH: AND I UNDERSTOOD YOUR ANSWER YOU'RE IN MICHIGAN AND YOU DID NOT TRAVEL TO ARIZONA TO VISIT ONE OF THE WALGREENS STORES THERE?
LISA PETERSON: NO. CORRECT. AND WE ALSO HAD GONE INTO THE WELLNESS CENTER AT THE BUILDING AND PRETTY MUCH GOT THE FEEL FOR WHAT IT WAS, YES.
MR. LEACH: OKAY. MAY I APPROACH, YOUR HONOR?
JUDGE DAVILA: YES.
MR. LEACH: MS. PETERSON, I'VE PLACED BEFORE YOU WHAT WE HAVE MARKED AS EXHIBIT 2065. DO YOU HAVE THAT IN FRONT OF YOU?
LISA PETERSON: WHAT YOU JUST HANDED ME?
MR. LEACH: YES. DO YOU SEE UP AT THE TOP THAT THIS APPEARS TO BE AN EMAIL FROM CHRISTIAN HOLMES TO SUNNY BALWANI AND ELIZABETH HOLMES?
LISA PETERSON: YES.
MR. LEACH: AND DO YOU SEE THE SUBJECT LINE WITH A REFERENCE TO BDT AND WAG?
LISA PETERSON: YES.
MR. LEACH: AND IN YOUR EXPERIENCE, IS WAG AN ACRONYM FOR WALGREENS?
LISA PETERSON: YES.
MR. LEACH: AND THE DATE OF THIS IS OCTOBER 10TH, 2014. IS THAT IN THE MONTH WHEN, WHEN RDV WAS CONSIDERING AN INVESTMENT DECISION?
LISA PETERSON: YES.
MR. LEACH: YOUR HONOR, I OFFER EXHIBIT 2065 INTO EVIDENCE.
MR. WADE: YOUR HONOR, I DON'T SEE ANY FOUNDATION OR RELEVANCE TO THIS DOCUMENT FROM THIS WITNESS, AND HEARSAY.
(PAUSE IN PROCEEDINGS.)
JUDGE DAVILA: CAN YOU LAY A LITTLE MORE FOUNDATION ON THIS, AND TELL ME HOW IT RELATES TO THE REDIRECT AGAIN.
MR. LEACH: YOUR HONOR, THIS WITNESS WAS ASKED QUESTIONS ABOUT WHETHER OR NOT RDV VISITED A WALGREENS IN THIS TIME PERIOD. THIS RELATES TO ANOTHER POTENTIAL INVESTOR IN THE SAME TIME PERIOD. IT'S NOT HEARSAY BECAUSE IT'S A STATEMENT OF AN AGENT. IT'S ALSO 801(D)(2)(E), AND I THINK MR. EDLIN LAID A FOUNDATION UNDER THE BUSINESS RECORD EXCEPTION. I ALSO OFFER IT FOR THE NONHEARSAY PURPOSE FOR STATE OF MIND TO THE RECIPIENT. AND IT RELATES TO -- THE QUESTIONS WERE ASKED ABOUT THE DILIGENCE AND WHAT SHE DID AND DIDN'T DO, AND THIS TOUCHES ON THAT.
MR. WADE: YOUR HONOR, I HATE TO DO THIS RIGHT AFTER THE BREAK, BUT THIS IS THE FIRST THAT WE HAVE SEEN OF THIS DOCUMENT. I WOULD ASK FOR A SIDE-BAR ON THIS ISSUE BEFORE WE GO INTO THIS.
JUDGE DAVILA: ALL RIGHT. LET'S -- CAN YOU CONTINUE YOUR EXAMINATION WITHOUT REFERENCE TO THIS DOCUMENT RIGHT NOW?
MR. LEACH: I CAN, YOUR HONOR, YES.
JUDGE DAVILA: THANK YOU. I APPRECIATE THAT. AND THEN WE'LL REVISIT THIS.
MR. LEACH: OKAY.
MR. LEACH: AND YOU UNDERSTOOD IN THIS TIMEFRAME THAT BDT WAS ALSO CONSIDERING AN INVESTMENT IN THERANOS?
LISA PETERSON: YES.
MR. LEACH: AND HOW DID YOU GET THAT UNDERSTANDING?
LISA PETERSON: MY BOSS HAD LET ME KNOW THAT THEY WERE LOOKING AT IT.
MR. LEACH: LET ME SHIFT TOPICS. LAST TOPIC OF EXAMINATION, MS. PETERSON. YOU WERE ASKED SOME QUESTIONS ABOUT YOUR APPROVAL DOCUMENT, EXHIBIT 2166. IF WE CAN PLEASE -- WHICH IS IN EVIDENCE. IF WE CAN PLEASE CALL THAT UP, MS. HOLLIMAN. IF WE CAN GO TO PAGE 6. ACTUALLY, IF WE CAN PLEASE GO TO THE NEXT PAGE, MS. HOLLIMAN. PAGE 7 OF THE DOCUMENT. EXCUSE ME.
JUROR: YOUR HONOR, IT'S NOT ON.
COURT CLERK: THAT ONE IS OUT AGAIN? I'M GOING TO SHUT DOWN AND RESTART.
(PAUSE IN PROCEEDINGS.)
COURT CLERK: THE MONITOR IS ON, BUT IT'S NOT PROJECTING. IT'S BEYOND MY CONTROL.
JUDGE DAVILA: OH, BROTHER.
MR. LEACH: YOUR HONOR, I CAN TRY TO CONTINUE MY EXAMINATION WITHOUT THE DOCUMENT ON THE SCREEN, AND PERHAPS DURING THE SIDE-BAR WE CAN WORK OUT THE TECHNICAL ISSUES.
JUDGE DAVILA: WE'LL TRY TO FIGURE IT OUT. I DON'T KNOW IF YOU HAVE THIS AVAILABLE FOR USE ON THE ELMO OR IF YOU WANT TO GO THAT FAR. OKAY.
BY MR. LEACH:
MR. LEACH: MS. PETERSON, DO YOU HAVE EXHIBIT 2166 IN FRONT OF YOU?
LISA PETERSON: IT'S ON THE SCREEN AT THIS POINT.
MR. LEACH: OKAY. I THINK SOME OF THE JURORS DON'T HAVE IT, SO LET'S WORK FROM THE HARD COPY IF WE CAN?
LISA PETERSON: OKAY. YES. YES.
MR. LEACH: THIS IS ENTITLED RDV APPROVAL DOCUMENT. WHY DID YOU PREPARE THIS?
LISA PETERSON: WE PREPARE THESE FOR EVERY INVESTMENT THAT WE DO. WE NEED TO HAVE THIS COMPLETED BEFORE WE CAN WIRE THE MONEY AND CLOSE THE DOCUMENTS.
MR. LEACH: IS THIS AN IMPORTANT PART OF YOUR PROCESS?
LISA PETERSON: YES.
MR. LEACH: AND IS IT IMPORTANT, WHEN PREPARING THIS, TO MEMORIALIZE WHAT YOU UNDERSTOOD ARE THE SALIENT FACTS RELATING TO THE INVESTMENT?
LISA PETERSON: CORRECT. IT PUTS IT IN WRITING.
MR. LEACH: HALFWAY DOWN THE LINE THERE'S A RECOMMENDATION AND IT SAYS R&D INVESTMENT GROUP RECOMMENDS A $100 MILLION INVESTMENT IN THE EQUITY OF THERANOS. DO YOU SEE THAT LANGUAGE?
LISA PETERSON: YES.
MR. LEACH: AND WHAT IS THE RDV INVESTMENT GROUP?
LISA PETERSON: THAT'S THE GROUP THAT I WORK FOR.
MR. LEACH: AND SO THE GROUP THAT INCLUDES YOU?
LISA PETERSON: YES.
MR. LEACH: OKAY. I HAVE NOTHING FURTHER BEYOND EXHIBIT 2065, YOUR HONOR.
JUDGE DAVILA: OKAY. WELL, LET'S TAKE THAT UP BEFORE WE -- LET ME -- WHY DON'T WE HAVE -- I THINK IT WOULD BE MORE EFFICIENT TO HAVE A SIDE-BAR IN THE JURY ROOM. SO WE'LL TAKE JUST A MOMENT. LADIES AND GENTLEMEN, I NEED TO SPEAK WITH THE LAWYERS OUTSIDE OF YOUR PRESENCE, SO WE'LL DO THAT. THIS WON'T TAKE LONG. MS. PETERSON, IF YOU COULD JUST REMAIN THERE, PLEASE.
LISA PETERSON: OKAY.
JUDGE DAVILA: WHILE WE'RE GONE, PLEASE DO NOT DISCUSS AMONGST YOURSELVES, LADIES AND GENTLEMEN OF THE JURY, ANYTHING. YOU CAN STAND AND STRETCH, OF COURSE, BUT DO NOT DISCUSS ANYTHING ABOUT THIS CASE. AND I'LL SEE COUNSEL IN THE BACK JUST NOW.
(SIDE-BAR CONFERENCE ON THE RECORD.)
JUDGE DAVILA: OKAY. LET'S GO ON THE RECORD. WE'RE OUTSIDE OF THE PRESENCE OF THE JURY. MR. LEACH IS PRESENT. MR. WADE IS PRESENT. THIS IS IN REGARDS TO 2065, WHICH IS -- IT LOOKS LIKE IT'S AN EMAIL STRING. MR. LEACH?
MR. LEACH: YOUR HONOR, DURING MS. PETERSON'S CROSS-EXAMINATION, THE DEFENSE ASKED A NUMBER OF QUESTIONS ABOUT WHETHER RDV WENT TO A WALGREENS AS PART OF DUE DILIGENCE AND WHETHER IT WOULD HAVE LEARNED THAT THERE WERE DEVICES IN THE STORES OR HOW THE BLOOD WAS DRAWN BY GOING TO A WALGREENS. THIS COMMUNICATION, WHICH IS CONTEMPORANEOUS, SUGGESTS THAT FOLKS WITHIN THERANOS WERE MAKING ARRANGEMENTS FOR WHAT SHOULD HAPPEN IF ANOTHER INVESTOR WENT INTO WALGREENS AND TAKING STEPS TO CONCEAL THAT THERE WERE VENOUS DRAWS BEING DONE. THIS IS NOT HEARSAY. CHRISTIAN HOLMES IS AN AGENT OF ELIZABETH HOLMES. HE REPORTS DIRECTLY TO HER. IT IS ALSO A, WE WOULD ARGUE, A STATEMENT OF A COCONSPIRATOR IN FURTHERANCE OF THE CONSPIRACY. THERE'S NO ISSUE WITH AUTHENTICATION. WE STIPULATED THAT THE DOCUMENTS WITH THE TS BATES PREFIX ARE AUTHENTIC. I THINK THIS IS -- IN ADDITION, DAN EDLIN LAID A FOUNDATION FOR THE USE OF EMAIL TO COORDINATE DEMOS, SO I THINK THERE'S A BUSINESS RECORDS EXCEPTION. FINALLY, WE WOULD OFFER IT FOR MS. HOLMES'S KNOWLEDGE OF WHAT WOULD HAPPEN IF AN INVESTOR WENT INTO WALGREENS TO TRY TO GET THEIR BLOOD TESTED. THERE'S A LINE IN HERE THAT SAYS ASSUMPTIONS HERE ARE FROM EAH, THAT'S ELIZABETH HOLMES, SO THAT WE MUST NOT DO A VENOUS DRAW FOR THIS VERY IMPORTANT INVESTOR. I THINK IT'S DIRECTLY RELEVANT TO THE DILIGENCE THAT RDV IS BEING ACCUSED OF NOT DOING, AND IT SHOULD COME IN AT THIS TIME.
JUDGE DAVILA: THANK YOU. WHO WAS THE -- WHO, AS TO THE 801(D)(2)(E), WHO IS THE COCONSPIRATOR? THIS IS FROM CHRISTIAN HOLMES AND HE'S NOT A COCONSPIRATOR. HE'S NOT IN THE INDICTMENT ANYWAY.
MR. LEACH: HE'S NOT IN THE INDICTMENT, YOUR HONOR, BUT THAT DOESN'T MEAN THE EXCEPTION CAN'T APPLY TO HIM. BUT HE'S ALSO AN AGENT.
MR. WADE: A FEW POINTS. ONE, THIS IS WELL OUTSIDE OF THE SCOPE OF CROSS. THEY TESTIFIED THAT THEY DIDN'T GO TO A WALGREENS. THE IDEA THAT THAT SOMEHOW OPENS THE DOOR ON REDIRECT AS TO ANYTHING THAT EVER HAPPENED WITHIN A WALGREENS WITH RESPECT TO ANYONE I THINK IS, YOU KNOW, IS WAY OUTSIDE OF THE SCOPE OF THE DIRECT. THIS IS THE FIRST THAT WE HAVE HEARD OF THE DOCUMENT. IT OPENS UP A WHOLE NEW SET OF ISSUES THROUGH THIS WITNESS, AND IT WOULD REQUIRE EXPLORATION. IT'S ALSO -- THE 801(D)(2)(E) EXCEPTION DOESN'T -- SO IT'S NOT APPROPRIATE FOR THIS WITNESS. I CAN SORT OF PARK THAT THERE BECAUSE NOW ALL OF A SUDDEN WE HAVE SOME WHOLE NEW ISSUE THAT IS WELL OUTSIDE OF THE SCOPE OF ANY OF THE EXAMINATION THAT, YOU KNOW, I DON'T EVEN KNOW WHAT TO DO. WE DIDN'T HAVE NOTICE THAT THIS MIGHT COME IN. WE ASK -- IF THE COURT IS GOING TO LET IT IN, WE WOULD ASK FOR THE COURT TO TAKE A RECESS AND ALLOW US TO PREPARE TO CONFRONT THE WITNESS ON THIS DOCUMENT BECAUSE WE'RE NOT PRESENTLY PREPARED TO DO THAT. THE 801(D)(2)(E) ISSUE, AS THE COURT WELL KNOWS, UNDER THE COURT LOCAL RULES AND THE NEW RULES OF EVIDENCE, THERE IS A NOTICE PROVISION THAT IS REQUIRED AND THIS WAS NOT NOTICED AS 801(D)(2)(E), AND I DON'T THINK THAT THEY CAN MAKE THE THRESHOLD SHOWING TO DO THAT. SO IT WOULD BE FUNDAMENTALLY UNFAIR TO DROP THIS INTO THIS EXAMINATION AT THIS TIME. I'LL ADD THAT WITH RESPECT TO BDT, THE WITNESS TESTIFIED THAT SHE DIDN'T HAVE ANY INTERACTIONS WITH BDT ABOUT THERANOS. SO A HEARSAY STATEMENT CAME IN RELATING TO THAT, BUT APART FROM THAT, WHICH I CHOSE NOT TO OBJECT TO, BUT APART FROM THAT, SHE HAS NO FIRSTHAND KNOWLEDGE OF ANYTHING RELATING TO BDT. SO THERE ARE MULTIPLE LEVELS OF FACTS THAT IT WOULD BE FUNDAMENTALLY UNFAIR TO DEAL WITH IT THROUGH THIS WITNESS.
JUDGE DAVILA: MR. LEACH?
MR. LEACH: YOUR HONOR, THE DEFENSE INJECTED BDT INTO THE CROSS-EXAMINATION. THERE WAS 15 MINUTES OF CROSS ABOUT HOW DID THIS INVESTMENT COME TO RDV'S ATTENTION. DID YOU GO TO THE CONFERENCE? DID YOU KNOW THAT MS. HOLMES SPOKE AT THE CONFERENCE? THIS IS CONTEMPORANEOUS WITH THE RDV INVESTMENT AND RIGHT AFTER THAT CONFERENCE. SO -- AND THE SUGGESTION WAS MADE THAT IF RDV HAD BEEN MORE DILIGENT, HAD THEY GONE TO A WALGREENS, THAT THEY WOULD HAVE FIGURED OUT EVERYTHING THAT THERE IS TO KNOW ABOUT HOW THE BLOOD WAS DRAWN AND VENOUS DRAWS, AND THIS WOULD SUGGEST THAT DID NOT HAPPEN, AND IT WAS DIRECTLY RELEVANT TO THE CROSS-EXAMINATION. THIS IS REDIRECT, SO I'M NOT AWARE OF A NOTICE. THIS HAS BEEN ON OUR EXHIBIT LIST FOR SOME PERIOD OF TIME, AND I THINK IT TIES DIRECTLY TO THE IMPLICATION THAT DEFENSE WAS TRYING TO RAISE IN THE CROSS-EXAMINATION WITH THIS WITNESS.
MR. WADE: WE ASKED WHETHER THEY WENT TO A WALGREENS, AND SHE DID NOT. THE IDEA THAT THEN ANYTHING THAT HAPPENS -- THAT OPENS THE DOOR TO ANYTHING THAT THAT HAPPENS WITHIN A WALGREENS IS WELL OUTSIDE OF THE SCOPE. AGAIN, IF THE COURT DECIDES TO DO THAT, I WOULD JUST, FOR THE RECORD, ASK FOR AN ADJOURNMENT FOR THE DAY SO THAT WE CAN, SO WE CAN COME BACK. IT'S NOT MY PREFERENCE, BUT THIS IS AN ISSUE THAT IS TOTALLY UNRELATED TO THIS WITNESS, AND THE IDEA THAT WE WOULD BE ON NOTICE BECAUSE IT'S AMONG THE, I DON'T KNOW, 10,000 DOCUMENTS THAT THEY PUT ON THEIR EXHIBIT LIST IS JUST NOT TRUE.
JUDGE DAVILA: SO, MR. LEACH, YOU'D LIKE TO EXAMINE THIS WITNESS ON THE ISSUE OF BDT BECAUSE MR. WADE DID ASK SOME QUESTIONS ABOUT IT. HE ASKED SOME QUESTIONS ABOUT WALGREENS. THERE WAS THIS COLLOQUY ABOUT DO YOU SEE THE PHOTOGRAPH, AND THEN SHE VOLUNTEERED. I CAN'T REMEMBER IF I STRUCK IT OR NOT, BUT SHE VOLUNTEERED, WELL, THAT'S NOT -- WE LOOKED AT THE -- WE SAW THE LAB AS IT WAS SET UP WITH THE EDISON INSIDE OF THERANOS. SO THAT LINE OF QUESTIONING. AND THIS, I'M JUST TRYING TO CAPTURE AGAIN, THE -- WHAT YOU'RE ATTEMPTING TO DO ABOUT THIS WITH BDT, TO ASK THIS WITNESS ABOUT BDT?
MR. LEACH: IT'S HONESTLY, IT'S AN APPROPRIATE TIME TO ADMIT THE EXHIBIT BECAUSE IT RELATES TO THE SUBJECT MATTER OF THE CROSS-EXAMINATION. I DON'T HAVE ADDITIONAL -- SIGNIFICANT ADDITIONAL QUESTIONS OF THIS WITNESS BEYOND WHY YOU DIDN'T GO TO A WALGREENS, DID YOU NONETHELESS KNOW ABOUT VENOUS DRAWS. SO I DON'T HAVE MORE THAN THAT ON THIS PARTICULAR DOCUMENT. BUT THERE'S NO REASON THAT THIS DOCUMENT COULDN'T COME IN NOW OR, FRANKLY, ANY OTHER TIME GIVEN THE STIPULATION TO AUTHENTICITY AND THE ABSENCE OF A HEARSAY ISSUE.
JUDGE DAVILA: THANK YOU. SO IS THE, IS THE -- IS THIS -- THIS SEEMS TO INDICATE THE PROTOCOL THAT IS USED FOR VENOUS DRAWS AT THE WALGREENS, IS THAT WHAT THIS STATES?
MR. LEACH: YES. IT'S AN INSTRUCTION ON WHAT HAPPENS IF A BDT -- IF A REPRESENTATIVE OF BDT, A POTENTIAL INVESTOR ASKS FOR A TEST THAT REQUIRES A VENOUS DRAW, AND THERE'S SCENARIO 1 WITH A CASE A AND A CASE B; AND SCENARIO 2, IF BDT ORDERS TESTS THAT CAN ALL BE DONE ON FINGERSTICK. SO IT'S A ROAD MAP FOR THE FOLKS WITHIN THERANOS IF BDT ORDERS A TEST REQUIRED OF VENOUS DRAW TO DO IT IN A WAY THAT WON'T BRING TO ATTENTION THAT IT'S A VENOUS DRAW.
JUDGE DAVILA: RIGHT. OKAY. I'M JUST CURIOUS ABOUT THE TIMING UNDER THIS WITNESS, AND I KNOW THERE WAS CONVERSATION ABOUT BDT AND ALL OF THAT. I'M NOT CERTAIN THAT THAT'S -- I GUESS THAT THE TIMING IS RIGHT TO GET THIS IN THROUGH THIS WITNESS AT THIS TIME, NOTWITHSTANDING THE FACT THAT THERE WAS BDT MENTIONED. I DO SEE THAT IT LOOKS LIKE THAT THIS -- AT THE BOTTOM IT SAYS IT'S FROM SUNNY BALWANI. WHAT DOES THAT MEAN?
MR. LEACH: I THINK THE BOTTOM EMAIL IS FROM SUNNY BALWANI, BUT THE TOP EMAIL WITH THE SUBSTANCE OF THE ROAD MAP IS FROM CHRISTIAN HOLMES --
JUDGE DAVILA: RIGHT.
MR. LEACH: -- TO SUNNY BALWANI AND MS. HOLMES. AND ANOTHER RESPONSE TO THE HEARSAY IS THAT THIS GOES TO HER STATE OF MIND AT THE TIME THAT SHE'S SOLICITING INVESTMENTS FROM BOTH BDT AND RDV.
MR. WADE: YOUR HONOR, MIGHT I SUGGEST GIVEN WE HAVE THE JURY HERE, I THINK THERE ARE OTHER ISSUES, JUST IN THE INTEREST OF EFFICIENCY WITH THE TRIAL TIME, MR. MOSLEY IS GOING TO TESTIFY. THERE'S GOING TO BE A LOT OF DISCUSSION ABOUT BDT WITH MR. MOSLEY. I EXPECT THAT MR. MOSLEY IS GOING TO CARRY OVER. WHY DON'T WE WAIT AND RAISE THIS ISSUE, GIVE US A CHANCE TO READ THIS AND GIVE IT SOME CONTEXT. THE OTHER THING THAT CONCERNS ME SLIGHTLY WITH THIS, YOUR HONOR, IS THAT IT BRINGS IN A WHOLE ANOTHER AREA OF ISSUES, AND THERE'S A POTENTIAL MINI TRIAL ISSUE RELATING TO BDT AS A POTENTIAL INVESTOR. AND IF THE GOVERNMENT DECIDES THAT THEY WANT TO OPEN THE DOOR WITH RESPECT TO CERTAIN BDT INTERACTIONS AS A POTENTIAL INVESTOR, THAT POTENTIALLY OPENS THE DOOR TO A WHOLE OTHER SET OF EVIDENCE. AND RATHER THAN DOING THIS ON THE FLY WHEN WE'RE TRYING TO FINISH UP WITH A WITNESS WHO IS NOT NECESSARY FOR THE ADMISSION OF THIS DOCUMENT, WHY DON'T WE CLOSE THIS WITNESS, KEEP GOING, AND ADDRESS THIS ISSUE WHEN WE'RE NOT HOLDING A JURY OUTSIDE.
JUDGE DAVILA: WELL, I APPRECIATE THAT. BUT BDT WAS MENTIONED. SO I UNDERSTAND THE TIMING OF IT. MR. LEACH SAYS, WELL, THAT WAS MENTIONED. IT COMES IN FOR NOT SO MUCH, AT LEAST AS I UNDERSTAND IT NOW, FOR THE FLOW OF THIS WITNESS'S TESTIMONY BUT RATHER IT COMES IN AS TO -- THIS EMAIL DOES TALK ABOUT WHAT EAH, ELIZABETH HOLMES'S, PROTOCOL, AND WHAT SHE THINKS SHOULD HAPPEN IN THAT. IT'S INSTRUCTIVE FROM HER. I UNDERSTAND WHY -- I THINK I UNDERSTAND WHY MR. LEACH WOULD SEEK TO INTRODUCE IT NOW BECAUSE THE BDT WAS RAISED ON YOUR EXAMINATION AND SUCH THAT THE JURY WOULD NOT HAVE -- WOULD HAVE A FULL STORY ABOUT BDT AT LEAST AS TO THIS. THE TIMING OF IT, THOUGH, IS -- THERE'S CONVERSATION ABOUT BDT. I COULD SEE HOW THIS WOULD COME IN. AND LET ME JUST STATE AS A SEPARATE NOTE, I HAVE BEEN TAKING NOTES ABOUT THE EVIDENCE AND THE STATEMENTS FROM VARIOUS PARTIES. I HAVE NOT -- YOU HAVE NOT ASKED ME TO MAKE A FINDING AS TO WHETHER OR NOT A PRIMA FACIE CASE OF CONSPIRACY HAS BEEN SHOWN SUCH THAT STATEMENTS CAN BE ENTERED. I THINK THIS IS THE FIRST TIME THAT THAT HAS COME UP IN THE TRIAL WHERE, MR. LEACH, YOU MENTIONED IT COULD COME IN AS A STATEMENT OF A COCONSPIRATOR IN FURTHERANCE OF UNDER 801(D)(2)(E). I'VE TAKEN NOTES. I DON'T KNOW IF YOU WANT TO KNOW MY OPINION ABOUT IT. IT SEEMS TO ME THAT THERE HAS BEEN AT LEAST FOR PRIMA FACIE SHOWING, IT SEEMS LIKE SOME OF THE STATEMENTS AND THE EVIDENCE THAT HAS COME IN DOES ESTABLISH AT LEAST FOR EVIDENTIARY PURPOSES A PRIMA FACIE CASE. I DON'T KNOW IF YOU WANT TO COMMENT. I'M NOT TRYING TO TAKE US DOWN A SIDE ROAD BUT --
MR. WADE: I'D LIKE TO ADDRESS THAT MORE THOUGHTFULLY, FRANKLY, YOUR HONOR, RATHER THAN DOING IT ON THE FLY WITH RESPECT TO THIS ISSUE. OF COURSE, THERE'S A NOTICE CONCERN THAT COMES WITH 801(D)(2)(E) --
JUDGE DAVILA: RIGHT.
MR. WADE: -- THAT THE NORTHERN DISTRICT TAKES VERY SERIOUSLY, AND I KNOW THE COURT DOES AS WELL. THIS WAS NOT NOTICED UNDER 801(D)(2)(E), AND THAT IS NOW ALSO A REQUIREMENT UNDER THE FEDERAL RULES OF EVIDENCE. THEY ACTUALLY -- THE NORTHERN DISTRICT WAS ACTUALLY A LITTLE IN FRONT OF THE RULES COMMITTEE ON THAT. SO I THINK IT WOULD BE UNFAIR TO CONCLUDE ON THIS WITHOUT NOTICE. ARGUABLY IT'S EXCLUDABLE AS OFFERED UNDER THAT AS A RESULT OF THE LACK OF NOTICE, BUT AT A MINIMUM, I WOULD LIKE TO HAVE THE OPPORTUNITY TO ADDRESS THAT. AGAIN, THIS WITNESS OFFERS NO TESTIMONY ON THIS. BDT WAS ADDRESSED, BUT IT WASN'T ADDRESSED IN CONNECTION WITH WALGREENS. IT WAS ADDRESSED IN CONNECTION WITH A CONFERENCE. SHE DIDN'T HAVE ANY INTERACTIONS OR KNOWLEDGE OF BDT APART FROM WHAT MR. LEACH JUST PULLED OUT ON REDIRECT, WHICH HE CAN'T OPEN HIS OWN DOOR. I ASKED QUESTIONS ABOUT WHETHER SHE HAD INTERACTIONS WITH BDT OR WHETHER SHE KNEW ABOUT INTERACTIONS, WHETHER SHE WAS THERE, AND HER ANSWER UNDER ALL OF THAT WAS NO. SO I THINK IT'S A HUGE STRETCH TO PUT THIS IN. IT DOESN'T NEED TO COME IN NOW. I'D LIKE THE OPPORTUNITY TO, YOU KNOW, TO CONSIDER THIS AND ADDRESS THIS OUTSIDE OF THE CONTEXT GIVEN THAT WE DIDN'T GET NOTICE AND IT'S BEING OFFERED AS A COCONSPIRATOR EXCEPTION.
JUDGE DAVILA: WELL, AMONGST OTHERS, BUT THERE ARE OTHER REASONS WHY MR. LEACH PROFFERS THIS. HE DID OFFER IT FOR THAT PURPOSE. BUT I DO -- I SEE SOME RELEVANCE AS TO THIS. WHETHER OR NOT TIMING IS APPROPRIATE NOW TO INTRODUCE IT -- YOU KNOW, MR. LEACH, I'M GOING TO SUSTAIN THE OBJECTION AS TO THIS WITNESS. I JUST DON'T THINK THE TIMING IS RIGHT AND THE FOUNDATION IS THERE TO GET THIS IN NOW. I MADE MY COMMENTS ABOUT AT LEAST GENERALLY FINDING THE EVIDENCE SHOWS BASED UPON TEXT MESSAGES, AND I DON'T HAVE ALL OF MY NOTES HERE, BUT I'VE MADE NOTES ABOUT ASPECTS OF CONVERSATIONS AND OTHERS THAT COULD SHOW A PRIMA FACIE CASE OF A CONSPIRACY IN FURTHERANCE OF DURING THE CHARGING PERIOD, WHICH WOULD THEN OPEN THE DOOR FOR OTHER HEARSAY STATEMENT OR OTHER STATEMENTS OF THE PARTIES. I JUST WANT TO LET YOU KNOW THAT, AND I'M DOING THIS OUTSIDE OF THE PRESENCE OF THE JURY, OF COURSE, JUST TO KEEP YOU APPRISED OF THAT. BUT ALL OF THE NOTICE AND ALL OF THE OTHER RULES, OF COURSE, APPLY. BUT SINCE YOU RAISED IT, MR. LEACH, TALKING ABOUT THIS, I THOUGHT I WOULD GIVE YOU AT LEAST THE BENEFIT OF MY THOUGHTS ON THAT, RIGHT OR WRONG, BUT I JUST WANTED TO SHARE THAT WITH YOU.
MR. LEACH: THANK YOU, YOUR HONOR.
JUDGE DAVILA: SO YOU CAN EXPLORE BDT. IT WAS TALKED ABOUT. I JUST THINK GETTING THE DOCUMENT IN NOW THROUGH THIS WITNESS IS NOT APPROPRIATE AT THIS TIME. SO AT THIS TIME I'LL SUSTAIN THE OBJECTION. I'LL DO IT OUT THERE IN FRONT OF THE JURY.
MR. LEACH: OKAY.
MR. LEACH: THANK YOU, YOUR HONOR.
(END OF DISCUSSION AT SIDE-BAR.)
JUDGE DAVILA: ALL RIGHT. THANK YOU FOR YOUR PATIENCE. WE'RE BACK ON THE RECORD. ALL PARTIES PREVIOUSLY PRESENT ARE PRESENT ONCE AGAIN. AS TO THE OBJECTION, I'LL SUSTAIN THE OBJECTION AT THIS TIME. THANK YOU. MR. LEACH, YOU CAN ASK ANY OTHER QUESTIONS THAT YOU HAVE.
MR. LEACH: I HAVE NO FURTHER QUESTIONS, YOUR HONOR. THANK YOU, MS. PETERSON.
JUDGE DAVILA: ALL RIGHT.
RECROSS-EXAMINATION BY MR. WADE:
MR. WADE: MS. PETERSON, IF WE COULD JUST PULL UP BRIEFLY 14210. I'M SORRY, 1853. EXHIBIT 1853, WHICH IS IN EVIDENCE. DO YOU RECALL JUST BEING ASKED SOME QUESTIONS ABOUT THIS ONCE AGAIN?
LISA PETERSON: YES.
MR. WADE: AND I'M SORRY, CAN WE PULL THIS ONE DOWN. DO WE -- I JUST WANT TO MAKE SURE THAT WE HAVE 1853 UP. IS THAT CORRECT? I'M SORRY. I THOUGHT WE HAD THE WRONG DOCUMENT UP THERE FOR A SECOND. OKAY. DO YOU RECALL BEING ASKED QUESTIONS ABOUT THIS DOCUMENT?
LISA PETERSON: YES.
MR. WADE: AND I JUST WANT TO GO TO THE SECOND PAGE. THIS RELATED -- I'M SORRY. BACK TO THE FIRST PAGE FOR ONE SECOND. AND THIS RELATED TO THE REVENUE PROJECTIONS OF 140 MILLION FOR 2014. DO YOU SEE THAT?
LISA PETERSON: YES.
MR. WADE: OKAY. I JUST WANT TO GO TO THE SECOND PAGE AGAIN. AND DO YOU SEE THE DEFERRED REVENUE THAT YOU CIRCLED THERE?
LISA PETERSON: YES.
LISA PETERSON: YES.
JUDGE DAVILA: MR. LEACH?
MR. LEACH: NOTHING FURTHER, YOUR HONOR. THANK YOU.
JUDGE DAVILA: MAY THIS WITNESS BE EXCUSED?
MR. LEACH: YES.
JUDGE DAVILA: THANK YOU. MS. PETERSON, YOU'RE EXCUSED. DOES THE UNITED STATES HAVE ANOTHER WITNESS?
MR. SCHENK: YES, YOUR HONOR. THE UNITED STATES CALLS CONSTANCE CULLEN.
JUDGE DAVILA: GOOD MORNING. IF YOU COULD APPROACH OUR COURTROOM DEPUTY. AND AS YOU FACE HER, IF YOU'D RAISE YOUR RIGHT HAND, SHE HAS A QUESTION FOR YOU.
(GOVERNMENT'S WITNESS, CONSTANCE CULLEN, WAS SWORN.)
LISA PETERSON: YES.
JUDGE DAVILA: LET ME INVITE YOU TO HAVE A SEAT UP HERE AND MAKE YOURSELF COMFORTABLE. FEEL FREE TO ADJUST THE CHAIR AND MICROPHONE AS YOU NEED. THERE'S SOME FRESH WATER THERE FOR YOUR CONVENIENCE IF YOU WISH.
LISA PETERSON: THANK YOU.
JUDGE DAVILA: WHEN YOU ARE COMFORTABLE, IF WOULD YOU PLEASE STATE YOUR NAME AND SPELL IT, PLEASE. I'LL ENCOURAGE YOU TO SPEAK DIRECTLY INTO THE MICROPHONE.
LISA PETERSON: YES. MY NAME IS CONSTANCE CULLEN. C-O-N-S-T-A-N-C-E. C-U-L-L-E-N.
JUDGE DAVILA: THANK YOU. MR. SCHENK.
MR. SCHENK: THANK YOU, YOUR HONOR.