When you hobnob with celebrities and titans of society, you need good jewelry. And former Theranos CEO Elizabeth Holmes owned some of the finest
So when Holmes charged a $2,000 item from a jewelry store to Theranos, it wasn’t out of the ordinary. Except that the person who managed the finances at Theranos for over a decade, So Han Spivey, began asking questions.
Spivey, who also goes by Danise Yam, was the first witness the government called on Wednesday in Holmes’ fraud trial. According to a court filing, attorneys for Holmes are asking the judge to block Spivey from testifying about Holmes using corporate funds for extravagant purchases.
Spivey worked at Theranos from 2006 to 2017. In an interview with federal prosecutors in July, she “recalled asking Holmes about a $2,000 purchase from a jewelry store and why Theranos should pay for it,” according to a court filing.
Holmes had a six-figure salary and an ownership stake in her blood-testing start-up Theranos that was valued at up to $4.5 billion. The details of her luxurious lifestyle and whether her wealth and perks as CEO is relevant for jurors has been a contentious battle.
“Holmes would charge travel to Theranos to include flights on a private jet, and Spivey would have to ask Holmes for approval to pay the private jet company,” according to the new filing. “Theranos would also pay for Holmes’ hotel bills, there was no budget at Theranos for Holmes’ travel expenses, in fact there was no budgeting at Theranos.”
Once hailed as a billionaire on paper, Holmes was often chauffeured with a heavy security detail. Former employees recall that when she wasn’t chauffeured, she drove her own car – the latest Range Rover.
Holmes stayed in luxury hotels and relied on multiple Theranos-paid assistants to run her lavish shopping sprees including: home decorating, jewelry, clothes and grocery shopping.
On Wednesday, the former head of finance highlighted a period in 2009 when she says the company struggled making payroll for vendors that they had to “pick and choose” who to pay. Spivey testified they took out a loan backed by Sunny Balwani, former Theranos president and for a time Holmes’ boyfriend.
In May, U.S. District Court Judge Edward Davila ruled that he would allow prosecutors to demonstrate that Holmes enjoyed a lifestyle comparable to other CEOs in Silicon Valley. He tempered the ruling by prohibiting the reference of specific purchases and brands. Davila said he would consider the latest request during Spivey’s testimony which resumes on Friday.
