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Federal Criminal Trialtrial-daytrial-dayJohn C. BosticLance A. WadeErika CheungdirectcrossDay 7 - September 15, 2021Erika Cheung described Edison quality-control failures, data-point removal, proficiency-testing disparities, and her internal and external reporting. Cross-examination addressed her limited role, Theranos validation records, compressed timelines, and differences between written procedures and laboratory practice.
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Day 7 - September 15, 2021

Cheung Details Edison Failures and Reporting; Cross-Examination Tests Validation Work

Judge Edward J. Davila
3Proceedings
2Pages
1Witnesses
1,918Lines
Day 7 of 51
Appearing:

Erika Cheung described Edison quality-control failures, data-point removal, proficiency-testing disparities, and her internal and external reporting. Cross-examination addressed her limited role, Theranos validation records, compressed timelines, and differences between written procedures and laboratory practice.

Full day summary

Erika Cheung testified that Theranos demonstrations combined Edison devices with third-party analyzers and that Edison tests could be dropped when problems arose. She described frequent quality-control failures, removal of data points without a defined outlier protocol, disparities between Edison and predicate-device proficiency results, and the use of a commercial hepatitis C test after she objected to using Edison devices. She said regulators received predicate-method proficiency results rather than Edison-generated results during her employment. Cheung also recounted raising concerns internally, leaving after Sunny Balwani questioned her qualifications, and later contacting CMS. The court admitted Tyler Shultz's email to Elizabeth Holmes only to show notice. On cross-examination, Cheung acknowledged that her laboratory-associate role involved basic operations and that she lacked knowledge of several regulatory qualifications and assay-specific standards. The defense introduced validation reports and a standard operating procedure showing documented review and approval. Cheung testified, however, that Theranos compressed work she said would ordinarily take about three months into several days, that actual practices sometimes differed from written procedures, and that frequent reader failures led to additional recalibration. The unfinished cross-examination was recessed until Friday. Outside the jury's presence, the court found sufficient business-records foundation for specified Cheung-related emails while requiring exhibit-by-exhibit review and foundation for others. It also sustained a defense objection to broader testimony about Cheung's later nonprofit work.

1. Erika Cheung Email Admissibility Hearings

Court convened outside the jury's presence for evidentiary disputes concerning Erika Cheung's emails and related testimony before the jury returned and her examination resumed.

Procedural
Morning Convening Outside the Jury's Presence

Court convened at 8:37 a.m. outside the jury's presence.

Procedural
Hearing on Admissibility of Cheung Email Exhibits

The court accepted a business-records foundation for Cheung's Normandy 911 emails but required exhibit-specific review and deferred the alternative foundation for Exhibit 1589.

Procedural
Hearing on Cheung Hearsay, Notice, and Prejudice Issues

The parties disputed Cheung-related hearsay, notice, emotional testimony, and CMS evidence, and the court accepted standing objections while leaving the specific exhibit questions for later handling.

Procedural
Seated-Juror Media Exposure Inquiry

No juror raised a hand during the court's overnight media-exposure inquiry, and the judge adjusted the day's schedule before Erika Cheung returned to the stand.

Highlights

2. Erika Cheung — Direct/Cross (Continued)

Erika Cheung finished direct testimony about Theranos laboratory concerns before the defense began cross-examination on her qualifications, assay validation, quality control, and laboratory procedures.

Direct
Erika CheungJohn C. Bostic
868 lines

Cheung described recurring Edison QC failures, manual outlier removal, disparities in proficiency testing, internal warnings, and her eventual decision to leave Theranos and report concerns externally.

sidebar
Sidebar on Relevance of Cheung's Nonprofit Work

The court excluded testimony about Erika Cheung's nonprofit work but allowed a narrower concluding question about her current work.

Direct
Erika CheungJohn C. Bostic
12 lines

Cheung briefly confirmed her current employment status before the prosecution concluded direct examination and the court called for cross-examination.

Cross
Erika CheungLance A. Wade
880 lines

Defense counsel emphasized Theranos's trained laboratory teams, formal validation reports, multiple approvals, and written operating procedures while narrowing Cheung's personal expertise. Cheung agreed that QC preceded patient testing but maintained that validation was sometimes compressed, written procedures differed from practice, and frequent reader failures required extensive recalibration.

Highlights

Erika Cheung — Directtestimony highlightCheung explained that VIP demonstration samples were divided among three teams and processed using Edison devices and third-party analyzers; Edison testing could be dropped when delays or problems arose.Erika Cheung — Directtestimony highlightCheung testified that Theranos frequently removed two of six generated data points without a defined outlier protocol, which could make QC or validation data appear better.Erika Cheung — Direct“SO IT -- THERE WAS NO STANDARD PROTOCOL AT THERANOS FOR WHAT OUTLIER DELETION WAS. IT WAS SOMETHING THAT WAS CONDUCTED QUITE FREQUENTLY, AND IN NORMAL SENSE THIS WOULD BE CONSIDERED CHERRY PICKING, WHERE YOU'RE ESSENTIALLY PICKING THE BEST DATA POINTS TO MAKE IT APPEAR THAT THE QUALITY OF THE DATA IS BETTER THAN IT IS.”— Erika CheungCheung characterized Theranos's outlier-removal practice and explained why she believed it overstated data quality.Erika Cheung — Direct“IT HAD VERY POOR PERFORMANCE. WE WERE HAVING QC FAILURES AT A MAXIMUM EVERY THREE DAYS, POSSIBLY MORE.”— Erika CheungCheung gave a memorable assessment of the frequency and quality of Edison QC performance.Erika Cheung — Directtestimony highlightComparative proficiency-testing data showed disparities between Edison and predicate-device results, including inconsistent Edison reruns; Cheung testified that Edison-generated proficiency results had not been provided to regulators during her employment.Erika Cheung — Direct“AT MY TIME AT THERANOS WE DID NOT PROVIDE REGULATORS WITH THE RESULTS GENERATED FROM THE THERANOS EDISON DEVICES SIMPLY FROM THE PREDICATE METHOD. SO THIS INFORMATION WAS NOT PROVIDED TO REGULATORS.”— Erika CheungCheung testified from her involvement in proficiency testing about which results were provided to regulators during her employment.Erika Cheung — Directtestimony highlightMarch 2014 data showed a 25.6 percent overall Edison QC-run failure rate, which Cheung described as typical rather than an unusually bad month; she contrasted that with rare QC failures on third-party devices.Erika Cheung — Directevidence eventThe court admitted Tyler Shultz's email to Elizabeth Holmes solely to show notice, and later admitted the law-firm letter delivered to Cheung; Cheung said she subsequently contacted CMS about the laboratory concerns.Erika Cheung — Crosstestimony highlightCheung described her lab-associate position as involving basic test operations and acknowledged that she did not know several laboratory classifications, regulatory qualifications, or assay-specific accuracy and precision standards.Erika Cheung — CrossadmissionCheung explained the extensive R&D and clinical-validation workflow but said Theranos compressed work that would usually take about three months into periods ranging from three days to a week and a half; she generated data while others performed the analysis and incorporated it into reports.Erika Cheung — Cross“BUT AT THERANOS WE WERE RUNNING THEM IN A SHORTENED TIMEFRAME, SO WE WOULD JUST TRY AND GET THEM DONE AS SOON AS POSSIBLE. SO IT WOULD BE LIKE THREE DAYS TO A WEEK AND A HALF.”— Erika CheungAlthough the defense emphasized the amount of validation work, Cheung testified that Theranos compressed a process she said would usually take about three months.Erika Cheung — Crosstestimony highlightCheung agreed that QC samples were not patient samples and that patient testing followed successful QC, but she also testified that actual laboratory practices sometimes differed from the written SOP and that frequent reader failures led to added recalibration steps requiring substantial time.
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