23andMe seeks approval of larger, $50 million data breach settlement

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By Jonathan Stempel

(Reuters) -The genetics testing company 23andMe asked a federal bankruptcy judge to approve a $50 million settlement to resolve claims from a 2023 data breach that exposed genetic and other personal information of about 6.4 million U.S. customers.

A preliminary settlement was filed late Thursday night in St. Louis bankruptcy court, where 23andMe filed for Chapter 11 protection from creditors in March.

Lawyers for the company said the settlement would set up a $30 million to $50 million fund and resolve a “substantial majority” of U.S. claims from the data breach, which began in April 2023 and lasted about five months.

More than 250,000 claimants, mostly in the United States, submitted proofs of claim, the lawyers said. The settlement also lets class members enroll for five years in a program known as Privacy & Medical Shield + Genetic Monitoring.

A $30 million settlement had been reached last September, before the bankruptcy, and won conditional approval from a San Francisco federal judge in December.

According to court papers, the revised settlement “closely tracks” that accord, but adds $20 million after a nonprofit controlled by founder Anne Wojcicki bought 23andMe’s assets for $305 million in July, resulting in more assets.

Proceeds from the sale “remain the only source of monetary recovery” for data breach victims, a factor weighing “heavily” in favor of settlement approval, 23andMe’s lawyers said.

The settlement also resolved accusations that 23andMe did not tell customers with Chinese and Ashkenazi Jewish ancestry that the hacker appeared to have targeted them, and posted their information for sale on the dark web.

The case is In re 23andMe Holding Co, U.S. Bankruptcy Court, Eastern District of Missouri, No. 25-bk-40976.

(Reporting by Jonathan Stempel in New York)