08-07-2025
Judge briefly pauses 23andMe bankruptcy sale amid California's appeal
July 8 (Reuters) - A U.S. district judge put on hold the bankruptcy sale of genetic testing company 23andMe late on Monday, giving California three days to make its case that the sale should remain blocked during an appeal related to the state's genetic privacy law.
California failed to convince a bankruptcy judge to stop the sale earlier on Monday, but U.S. District Judge Matthew Schelp in St. Louis ordered a brief pause following California's appeal of that ruling. Schelp scheduled a Thursday court hearing to determine if a longer pause is warranted in the case.
23andMe, which filed for bankruptcy in March, is selling its assets to TTAM Research, a new nonprofit founded by 23andMe co-founder Anne Wojcicki, for $305 million.
23andMe, TTAM and California did not immediately respond to a request for comment.
California argues the sale violates the state's Genetic Information Privacy Act, which prohibits the transfer and disclosure of genetic data or biological samples to third parties, including TTAM Research, without express permission for each transfer. California consumers represent about 1.8 million of the approximately 10 million genetic profiles in 23andMe's inventory, according to California's court filings.
U.S. Bankruptcy Judge Brian Walsh had overruled California's objection, and similar objections from other states opposed to the sale on June 27. He said Monday that California customers would not be harmed because they retained the right to delete their genetic data even after the sale is complete.
TTAM has said it would continue to protect customers' genetic data and maintain 23andMe's privacy policies, including customers' right to delete their data. Wojcicki was 23andMe's CEO before its bankruptcy filing, and her new nonprofit's name is an acronym formed from the first letters of the words 'twenty-three and me.'
23andMe filed for bankruptcy after a drop-off in consumer demand and a 2023 data breach that exposed millions of customers' genetic data.
The case is California v. 23andMe Holding Co., U.S. District Court for the Eastern District of Missouri, No. 25-cv-0099
For California: Bernard Eskandari and Daniel Nadal of the Office of the Attorney General of California
For 23andMe: Christopher Hopkins and Paul Basta of Paul Weiss, among others
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