Former Theranos COO Sunny Balwani and his attorneys leave the San Jose federal courthouse on June 10, 2019.
Sunny Balwani, the former chief operating officer and president of Theranos, will fight the criminal fraud charges against him, his attorney told CNBC on Monday.
“We’re going to fight it,” Jeffrey Coopersmith said prior to a court hearing connected to the case.
Balwani is facing nine counts of wire fraud and two counts of conspiracy to commit wire fraud, and is awaiting his criminal trial.
Asked about getting a fair trial from a San Jose jury pool who may be familiar with the case, Coopersmith told CNBC, “There’s a concern, there’s always a concern.”
Theranos, a blood-testing startup once valued at over $9 billion, was founded by Elizabeth Holmes in 2003. Holmes is also facing charges of wire fraud and conspiracy to commit wire fraud.
Theranos promised its technology could accurately run hundreds of tests with only one or two drops of blood. The company shut down in 2018 after a Wall Street Journal investigation exposed its unproven technology and dubious business practices.
Holmes and Balwani are both facing up to 20 years in prison if convicted.
Inside the courtroom, lawyers for the U.S. Department of Justice and Balwani battled over the Securities and Exchange Commission’s case.
The government filed a motion in April to intervene in the SEC’s civil enforcement action, arguing that parties and the court should not be burdened by civil discovery while the criminal case is pending.
Prosecutors also claim Balwani is using his pending SEC case to benefit his criminal indictment.
“It’s apparent Mr. Balwani is using civil discovery to gather evidence for the reason of his criminal case,” said Robert Leach, assistant U.S. Attorney.
Balwani’s attorney argued there’s no basis to issue a stay and if prosecutors have an issue with a subpoena they can object to it.
“The government chose to bring these two cases forward and the government can simply dismiss it,” said Coopersmith.
The SEC, also present in court, supported the request for a hold in its case against Balwani.
“It’s rare that the SEC affirmatively supports a stay,” said Mark Katz, an attorney for the SEC. “This is a rare situation. We’ve seen depositions with very sensitive information and we ask that you consider this stay.”
“There’s been great attention in what the truth is and what happened here,” said Leach. “The only way to do that is through the criminal trial.”
Holmes agreed to settle her fraud charges brought on by the SEC last year.
The judge took arguments under submission and announced he wants to set a trial date at the next status hearing.
The status conference for Holmes and Balwani is set for June 28.