watching him or Arne. You have a mediocre Lab Director taking up for a sub-par CLS for whatever reasons. I fully guarantee that Kosal will certainly make a huge mistake one day in the lab that will adversely affect patient results. I actually think he has already done this on several accounts but has put the blame on the reagents. Just as you stated everything he touches is a disaster!
I am [sic] only hope that somehow I bring awareness to you that you have created a work environment where people hide things from you out of fear. You cannot run a company through fear and intimidation…it will only work for a period of time before it collapses.
Sunny agreed to have someone meet her in front of the East Meadow Circle building to return her belongings but warned her that she would be hearing from the company’s lawyers. Over the next several days, Dupuy received a series of sternly worded emails from 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.
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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 spent $100 million more than that just to build the centers.
While they sat idle, the wellness centers occupied valuable real estate inside the stores that could have been put to other, profitable uses. Fed up with waiting, Renda and Bradley put together various ideas for how the space could be utilized. One of them was to staff the centers with nutritionists who would offer dietary advice. Another was to turn them into full-fledged medical clinics run by nurse practitioners. Yet another was to offer telemedicine services. They lobbied Burd to let them implement these plans but, after discussing the matter with Elizabeth, he turned them down. She didn’t want to surrender the space, he said.
Behind the scenes, Safeway’s board of directors was losing patience. After twenty years in the job, it was clear that Burd had lost the confidence of Wall Street. His first decade as CEO had been a big success and featured a sharp rise in Safeway’s stock price. But in recent years, his passion for health and wellness had made him lose sight of what remained at the heart of the company: the unglamorous business of selling groceries. The large investment made in the wellness centers and the endless delays in bringing it to fruition were the last straw.
Shortly after the stock market closed on January 2, 2013, Safeway put out a press release announcing that Burd would retire the following May after the company’s annual shareholder meeting. The news was presented as a voluntary decision, but Renda and other executives suspected