23andMe Alerts Customers About Bankruptcy and Claims Process: July 14 Filing Deadline

23andMe, once a prominent player in the genetic testing industry valued at over a billion dollars, has officially filed for Chapter 11 bankruptcy. The company is reaching out to its millions of current and former customers regarding potential eligibility to file claims during its restructuring phase. On March 23 of this year, 23andMe, in conjunction with 11 subsidiaries including Lemonaid Health and LPRXOne, sought bankruptcy protection in the Eastern District of Missouri. Customers were notified on Sunday that they have until July 14 to submit claims for any losses incurred.

This bankruptcy follows a difficult 18-month stretch for 23andMe, marked by declining sales, the exit of key executives, and a substantial data breach that affected sensitive information for nearly 7 million users. The breach, disclosed in October 2023, compromised personal details such as names, birth years, relationship statuses, DNA sharing rates, ancestry data, and self-reported locations, according to TechCrunch. This incident led to several class action lawsuits and severely impacted customer trust, greatly affecting the company’s operations.

Customers who were affected—particularly those notified by 23andMe about their data breach from May to October 2023—can submit a Cyber Security Incident Claim. Individuals who experienced financial or other damages due to the breach may file claims as part of the bankruptcy proceedings. Customers with additional concerns, such as issues regarding DNA test results or the company’s telehealth services, can submit separate claims under the General Bar Date Package.

Concerns are growing in Congress regarding the privacy implications associated with the bankruptcy.

The swift decline of 23andMe has been worsened by its ambitious yet costly ventures into digital health and telemedicine, particularly the $400 million acquisition of Lemonaid Health in 2021. While this strategy aimed to expand 23andMe’s offerings beyond consumer DNA testing, it ultimately strained financial resources without achieving the expected growth.

A proposed $30 million settlement concerning a class action lawsuit related to the cyberattack is currently on hold due to ongoing bankruptcy proceedings. Legal representatives for 23andMe have stated that the settlement is now under dispute in light of the bankruptcy. Customers wishing to retain their right to compensation must submit a formal proof of claim, regardless of their participation in the class action.

TechCrunch has requested further comments from 23andMe.