David Doyle, the Theranos senior counsel, demanding that she sign a
declaration pledging to return to Theranos or “permanently destroy”
any materials from her employment at the company and abide by her
confidentiality obligations.
Dupuy initially refused and hired an Oakland attorney to threaten
the company with a wrongful termination lawsuit, but her lawyer
advised her to back down and to sign the document once Theranos
brought in a high-powered attorney from Wilson Sonsini. Going up
against Silicon Valley’s premier law firm was a losing battle, he told
her. She reluctantly followed his advice.
—
SAFEWAY OF COURSE had no knowledge of any of this. It continued to
let Theranos handle the blood testing at its Pleasanton clinic
throughout 2012 and into 2013. It also began hiring phlebotomists to
staff the wellness centers it had built in dozens of its stores in
Northern California. But as the months went by, Theranos continued
to push back the date for a launch.
Burd was asked about the status of Safeway’s mysterious “wellness
play” on its first-quarter earnings call in late April 2012. He replied
that it wasn’t yet “ready for prime time” but that when the company
did unveil it, it would “have a material impact” on its financial results.
In the next earnings call in July, he volunteered that it would play “out
in all likelihood in the fourth quarter.” However, the fourth quarter
came and went without a launch.
By this point, some Safeway executives were getting angry. They
were being denied their bonuses because the company was missing its
financial targets, which had factored in the anticipated extra revenues
and profits from the Theranos partnership. Matt O’Rell, an executive
in Safeway’s finance department, had been tasked with coming up
with revenue projections for the wellness centers. Working from the
aggressive assumption that each of them would attract an average of
fifty patients per day, he had forecast $250 million in extra revenue
per year. Not only had that revenue failed to materialize, Safeway had