Chapter[ VII. Major League Baseball and the BALCO Investigation ]
Section[ A. The BALCO Raid and Grand Jury Investigation ]
VII. Major League Baseball and the BALCO Investigation
A. The BALCO Raid and Grand Jury Investigation
On September 3, 2003, law enforcement officers from several federal agencies
raided the offices of the Bay Area Laboratory Cooperative in Burlingame, California.292 The
raid was part of an investigation that had been underway since August 2002 into allegations that
a number of “‘world-class’ professional athletes were . . . illegally receiving anabolic steroids
and other athletic performance-enhancing drugs and having their steroid intake monitored by
persons associated with [BALCO].”293
On the day of the raid, Victor Conte, the founder and president of BALCO,
agreed to be interviewed by federal agents who were conducting the investigation.294 He told
them that BALCO was in the business of providing the “elemental analysis of blood and urine
samples.”295 Conte also admitted, however, that BALCO distributed to “elite athletes”
substances that he called “the cream” and “the clear” but that were, in fact, “athletic performance
enhancing substances.”296 Conte described “the clear” as a “liquid with anabolic effects” that
“helps the athlete with recovery.”297 He said he purchased a supply of “the clear” from a chemist
named Patrick Arnold for $450 and that supply had lasted him ever since.298
292 See Lonnie White, Raid Is Conducted on Supplement Company; BALCO a Northern
California firm, has a reputation of catering to high-profile athletes, L.A. Times, Sept. 5, 2003,
at D3.
293 Affidavit of Special Agent Brian Watson in Support of Request for Search Warrants,
sworn to on Sept. 3, 2003, at 2.
294 See generally Internal Revenue Service Memorandum of Interview of Victor Conte,
Jr., dated Sept. 3, 2003.
295 Id., ¶ 2.
296 Id., ¶¶ 7, 12.
297 Id., ¶ 7. Federal prosecutors later described “the clear” as “a steroid-like derivative
also now known as tetrahydragestrinone, or THG.” United States Sentencing Memorandum,
112
“The cream,” which athletes rubbed on their skin, was a combination of
testosterone and epitestosterone that Conte said he obtained from other sources. The
combination allowed athletes to take the substance without raising their “T/E ratio,” the ratio in
the bloodstream of testosterone and epitestosterone, thereby enabling the athletes to pass a drug
test. According to the Internal Revenue Service memorandum of his interview that day, “Conte
stated that he gives ‘the clear’ and ‘the cream’ to athletes so they can increase athletic
performance without getting caught by the testers.”299
Conte told the agents that he had sold “the cream” and “the clear,” and advised on
their use, to dozens of elite athletes, including several players in Major League Baseball whom
he named in the interview: Barry Bonds; Jason Giambi; Jeremy Giambi; Armando Rios; and
Gary Sheffield.300 In that regard, Conte explained:
At the beginning of this major league baseball season, Greg
Anderson, a personal trainer at Bay Area Fitness who works closely with
several major league baseball players, brought in several of the players to
Balco in order to obtain the undetectable cream and clear. This was done
because of Major League Baseball’s new drug testing policy. Barry
Bonds was one of the players that Anderson brought to Conte to obtain
“the clear” and “the cream”. Bonds takes “the clear” and “the cream” on a
regular basis. The protocol for using the substances is two times per week
for “the clear” and two times per week for “the cream”. The athletes do
this for three weeks then take one week off. [BALCO vice president] Jim
Valente deals more with Anderson than Conte does. Anderson last got
some of “the clear” and “the cream” from Conte for his athletes about
three (3) or (4) weeks ago.301
dated Oct. 11, 2005, United States of America v. Anderson, CR No. 04-0044 (N.D. Cal.)
(“Anderson Sentencing Memo.”), at 3.
298 Internal Revenue Service Memorandum of Interview of Victor Conte Jr., dated
Sept. 3, 2003, ¶ 7 (Exhibit M(1) to Declaration of Special Agent Jeff Novitzky dated Oct. 29,
2004, United States v. Conte, CR No. 04-0044-SI (N.D. Cal.)).
299 Id.
300 Id., ¶ 8.
301 Id., ¶ 11.
113
Conte told the agents that “Barry Bonds does not pay Conte for ‘the clear’ and ‘the cream’ that
he receives. Bonds’ payment is in the form of promotion for Conte’s ZMA product.”302
Valente also agreed to be interviewed by federal agents on the day of the BALCO
raid. During that interview, according to the Internal Revenue Service interview memorandum,
Valente stated:
[He] is aware that Greg Anderson also provides human growth hormone
and testosterone cypionate to his professional baseball clients. Anderson
told him this. Anderson brought his baseball clients to Balco this spring
when major league baseball announced their new steroid testing policy.
This was so Anderson could start giving them steroids that would not
show up in drug tests.
Among those baseball players brought to Balco by Anderson was Barry
Bonds. Bonds has received “the clear” and “the cream” from Balco on a
“couple of occasions”. According to Valente, Bonds does not like how
“the clear” makes him feel.
Other players that Anderson has obtained “the clear” and “the cream” for
from Balco are Benito Santiago, Gary Sheffield, Marvin Benard, Jason
Giambi and Randy Velarde. Sometime [sic] the substances are given to
Anderson to give to the athletes and sometimes the athletes are given the
substances directly. . . .
***
. . . One instance that Valente recalls where athletes did test positive for
steroids involved Jason and Jeremy Giambi. The Giambi brothers came to
Balco and informed them that they had taken a steroid some time ago and
wanted to see if it was still detectable in their systems. Valente recalled
that the particular steroid they took can stay in a person’s system for up to
18 months. The urine that Balco collected and sent out for testing came
back positive for steroids.
***
Valente recalls sending a blood sample belonging to Barry Bonds to Lab
One, then notifying Lab One that the sample did not refer to Bonds but
rather to Greg Anderson. Valente stated that Anderson asked him to do
this because Bonds did not want his name on the blood sample. Despite
302 Id., ¶ 22. ZMA is a nutritional supplement that is marketed by Conte’s other
company, SNAC System, Inc.
114
signing an affidavit stating that the blood sample was mislabeled as Barry
Bonds, Valente knew that it was Bonds’ blood.303
Both Conte and Valente later denied that they had made the statements attributed to them in the
Internal Revenue Service interview memoranda.304
After completing their search of the BALCO offices, agents also searched a
storage locker where Conte kept a supply of performance enhancing substances. There the
federal agents found six 100-gram jars of the “cream” and a quantity of injectable anabolic
steroids.305
Having obtained a search warrant for Greg Anderson’s residence and vehicle, the
agents then confronted Anderson at Bay Area Fitness and informed him of the warrant.306
Anderson accompanied the agents to his condominium, where the agents executed the search
warrant.307 Anderson initially agreed to speak with the investigators before later concluding that
he should no longer cooperate.308 According to the memorandum of his interview by federal
investigators, Anderson said that he began working with players in Major League Baseball
around 1997, that Barry Bonds was his first “athlete client,” and that he also worked as a trainer
303 Internal Revenue Service Memorandum of Interview of Jim Valente, dated Sept. 3,
2003, ¶¶ 4-6, 10, 13. (Exhibit M(2) to Declaration of Special Agent Jeff Novitzky dated Oct. 29,
2004, United States v. Conte, CR No. 04-0044-SI (N.D. Cal.))
304 See Reporter’s Transcript of Proceedings in United States v. Victor Conte, Jr., et. al.,
CR 04-00044, dated Dec. 1, 2004, at 3, 4, 8, 18, 28.
305 Anderson Sentencing Memo. at 4.
306 Internal Revenue Service Memorandum of Interview of Greg Anderson, dated Sept. 3,
2003, at 1. (Exhibit 1 to Declaration of Special Agent Ed Barberini dated Oct. 28, 2004,
United States v. Anderson, CR No. 04-0044-SI (N.D. Cal.)).
307 Id.
308 Id. at 1, 3.
115
with Marvin Benard, Bobby Estalella, Jason Giambi, Armando Rios, Benito Santiago, and Gary
Sheffield.309
Although initially he preferred “not to say who” received steroids from him,
Anderson eventually admitted that he had supplied performance enhancing substances to Benard,
Estalella, Rios, and Santiago.310 Anderson also stated that “Barry Bonds never took any of ‘the
clear’ or ‘the cream’ from Balco.”311 Anderson said that he provided Santiago with human
growth hormone a few months before the interview and had sent that substance by FedEx “in the
past” to both Estalella and Rios.312 During their search of Anderson’s home, agents found
documentary evidence “corroborating these admissions.”313
Anderson also told investigators that “[w]hen baseball began its steroid testing
procedures this year, some of Anderson’s baseball clients began taking ‘the clear’ and ‘the
cream’ products that Anderson gets from Balco Laboratories. . . . Valente told Anderson that
the cream was a combination of testosterone and epitestosterone and that this is why is [sic] was
safe for athletes being tested to use.”314
During Anderson’s interview, agents discovered “file folders labeled with names
of professional baseball players” containing “calendars with athletes [sic] names or initials on
309 Id., ¶ 4.
310 Id., ¶¶ 5, 9.
311 Internal Revenue Service Memorandum of Interview of Greg Anderson, dated Sept. 3,
2003, ¶ 17.
312 Id., ¶¶ 10, 11. Anderson said that he obtained the human growth hormone from AIDS
patients in San Francisco. Id., ¶ 14. Kirk Radomski also obtained human growth hormone that
he resold to major league players by purchasing “kits” of the substance from AIDS patients.
313 Anderson Sentencing Memo. at 5.
314Internal Revenue Service Memorandum of Interview of Greg Anderson, dated Sept. 3,
2003, ¶ 7.
116
them which appeared to contain details of steroid administration to athletes by dates.”315 Federal
prosecutors later explained that the calendars “contained codes reflecting individual athlete use
of the ‘[c]ream,’ the ‘[c]lear,’ human growth hormone, and injectable anabolic steroids.”316
Agents also found “$63,920 in currency,” quantities of both the “cream” and the “clear,” “empty
boxes of human growth hormone, a quantity of injectable anabolic steroids, syringes, and other
paraphernalia associated with steroid distribution.”317 After the agents found this evidence,
Anderson said that “he didn’t think he should be talking anymore because he didn’t want to go to
jail,” and the interview ended.318
A grand jury investigation continued into BALCO’s role in the alleged illegal
distribution of performance enhancing substances.319 It was directed by prosecutors from the
United States Attorney’s Office for the Northern District of California. Witnesses who were
subpoenaed to appear before the grand jury included Marvin Benard, Barry Bonds, Bobby
Estalella, Jason Giambi, Jeremy Giambi, Armando Rios, Benito Santiago, Gary Sheffield, and
Randy Velarde.320
Under federal law, with few exceptions, the testimony of witnesses before a grand
jury is considered confidential and cannot be disclosed. In a series of articles in early December
315 Id. at 3.
316 Anderson Sentencing Memo. at 4-5.
317 Id. at 4.
318 Internal Revenue Service Memorandum of Interview of Greg Anderson, dated Sept. 3,
2003, at 3.
319 Mark Fainaru-Wada, Grand Jury Probes Nutrient Company, S.F. Chron., Oct. 14,
2003, at A1.
320 See Lance Williams and Mark Fainaru-Wada, What Bonds told BALCO grand jury,
S.F. Chron., Dec. 3, 2004, at A1; see also Mark Fainaru-Wada and Lance Williams, Giambi
admitted taking steroids, S.F. Chron., Dec. 2, 2004, at A1; Murray Chass, Scope of Balco
Subpoena of Steroid Tests Is Greatly Reduced, N.Y. Times, Mar. 6, 2004, at D1.
117
2004, however, the San Francisco Chronicle published reports of the alleged testimony of many
of these Major League Baseball players, whose transcribed testimony two Chronicle reporters,
Mark Fainaru-Wada and Lance Williams, claimed to have reviewed.321
The Chronicle reported that, in his grand jury testimony, Bonds admitted that
during the 2003 season he had received substances sounding like the “clear” and the “cream”
from his personal strength trainer, Greg Anderson, and that he had used those substances. He
reportedly testified, however, that he was told “they were the nutritional supplement flaxseed oil
and a rubbing balm for arthritis.” The article reported that Bonds was asked during his testimony
if he had used anabolic steroids, human growth hormone, insulin, or Clomid (a female infertility
drug used by steroid abusers to counteract the effects of steroids on natural testosterone
production) over a three-year period from 2001 through 2003, and he denied that he had done
so.322 On November 15, 2007, Bonds was indicted for perjury and obstruction of justice based
on his grand jury testimony.323
The Chronicle also reported on the grand jury testimony of Jason Giambi.
According to the news story, Giambi testified that he had used several different performance
enhancing substances, some of which he had obtained from Greg Anderson. Giambi reportedly
told the grand jury that he injected himself with human growth hormone in his abdomen and
injected himself in the rear end with anabolic steroids. “Giambi also said he had taken
‘undetectable’ steroids known as ‘the clear’ and ‘the cream’ . . . .” Giambi was reported to have
321 See Lance Williams and Mark Fainaru-Wada, What Bonds told BALCO grand jury,
S.F. Chron., Dec. 3, 2004, at A1; see also Mark Fainaru-Wada and Lance Williams, Giambi
admitted taking steroids, S.F. Chron., Dec. 2, 2004, at A1.
322 See Lance Williams and Mark Fainaru-Wada, What Bonds told BALCO grand jury,
S.F. Chron., Dec. 3, 2004, at A1.
323 See Indictment, United States v. Bonds, No. 07 CR 0732 (N.D. Cal.).
118
testified that he obtained all of the substances except the human growth hormone from Greg
Anderson; he obtained the growth hormone from a Las Vegas gym.324
Before he began working with Greg Anderson, Giambi reportedly had self-
administered the anabolic steroid Deca-Durabolin, which he had obtained from a source at
Gold’s Gym in Las Vegas. Giambi submitted to blood and urine tests at Anderson’s direction,
which revealed his use of Deca-Durabolin and, he reportedly testified to the grand jury,
Anderson “warned him to stop using it, saying [that type of anabolic steroid] could stay in his
system a long time.”325
Giambi also reportedly told the grand jury that Anderson described “the cream”
and “the clear” as “an alternative to steroids” that did not appear on a test for steroids. Giambi
also acknowledged that a calendar kept by Anderson for his training program set forth the
regimen of substances he was taking under Anderson’s supervision, including the “cream,” the
“clear,” injectable testosterone, and a number of different pills.326
The Chronicle reported that Giambi’s brother, Jeremy, who also had played for
the Oakland Athletics, provided testimony that “mirrored his brother’s – right down to
Anderson’s notifying him that he had tested positive for the steroid Deca Durabolin.” Jeremy
Giambi reportedly testified that he had self-administered human growth hormone and
testosterone he received from Greg Anderson “before the start of the 2003 season, when he
played for the Boston Red Sox.” Anderson had told him that “the clear” and “the cream” were
324 Mark Fainaru-Wada and Lance Williams, Giambi admitted taking steroids,
S.F. Chron., Dec. 2, 2004, at A1.
325 Id.
326 Id.
119
“undetectable ‘alternatives to steroids.’” Both Giambis testified “they were drawn to [Greg
Anderson] because of Bonds’ success.”327
In addition to the testimony of Bonds and the Giambis, the Chronicle reported that
former San Francisco Giants players Bobby Estalella, Armando Rios, and Benito Santiago all
had admitted to using performance enhancing substances in their grand jury testimony, although
Santiago’s attorney said that if Santiago had ingested any performance enhancing substances it
had been without knowledge of what they were.328
The Chronicle also reported that New York Yankees outfielder Gary Sheffield
testified that when he was training with Barry Bonds before the 2002 season, Bonds “had
arranged for him to receive ‘the cream,’ ‘the clear’ and ‘red beans,’ which the prosecutors
identified as steroid pills manufactured in Mexico.” Sheffield was reported to have testified that
he did not interact directly with Anderson and that he was never told that the substances he was
given by Bonds were steroids.329
In February 2007, Troy Ellerman, formerly counsel to Jim Valente, was charged
by federal prosecutors with, among other things, permitting Fainaru-Wada “to take verbatim
notes of grand jury testimony of baseball players Jason Giambi, Barry Bonds and Gary
Sheffield.”330 Ellerman pled guilty and in July 2007 was sentenced to 30 months imprisonment
for contempt of court and obstruction of justice.331
327 Id.
328 Lance Williams and Mark Fainaru-Wada, What Bonds told BALCO grand jury,
S.F. Chron., Dec. 3, 2004, at A1.
329 Id.
330 Criminal Information, United States v. Troy L. Ellerman, No. CR 07-0080 (N.D. Cal.),
Feb. 14, 2007, at 4.
331 See Judgment, United States v. Troy L. Ellerman, No. CR 07-0080 (N.D. Cal.),
July 13, 2007.
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