23andMe Customers Facing Bankruptcy: Don’t Miss the July 14 Deadline to File Claims

23andMe Faces Bankruptcy Amid Data Breach Fallout

Once a genetic testing powerhouse valued in the billions, 23andMe is now grappling with Chapter 11 bankruptcy proceedings. The company, along with 11 of its subsidiaries like Lemonaid Health and LPRXOne, sought bankruptcy protection on March 23 in the Eastern District of Missouri. In a recent development, millions of current and former customers have been informed that they may be eligible to file claims as part of the restructuring process, with a deadline set for July 14.

The past year and a half have been challenging for 23andMe, marked by a decline in sales, key executive departures, and a significant data breach that impacted nearly 7 million users. Disclosed in October 2023, the breach exposed sensitive personal information, including names, birth years, DNA shared with relatives, ancestry reports, and more. This breach led to a series of class action lawsuits and eroded customer trust in the company.

Customers affected by the data breach, particularly those notified by 23andMe of compromised information between May and October 2023, now have the opportunity to file a Cyber Security Incident Claim. Those who suffered financial or other damages due to the breach can seek recourse through the bankruptcy case. Additionally, customers with different grievances unrelated to the cyberattack, such as issues with DNA test results or telehealth services, can file under the General Bar Date Package.

Congress has raised concerns about the privacy implications of 23andMe’s bankruptcy, further complicating the situation for the company. The company’s expansion into digital health and telemedicine, highlighted by the acquisition of Lemonaid Health for $400 million in 2021, also strained its financial resources and failed to deliver the expected growth.

Despite a proposed $30 million settlement in a class action lawsuit related to the data breach, the bankruptcy proceedings have put it on hold. Customers seeking compensation must submit a formal proof of claim, regardless of their involvement in the class action, to protect their rights to potential compensation.

For further insights and comments, TechCrunch has reached out to 23andMe for additional information.

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