23andMe bankruptcy proceedings are officially underway, and millions of customers are now being told they may be eligible to file claims — with a hard deadline set for July 14.
The once high-flying DNA testing giant, alongside 11 of its subsidiaries like Lemonaid Health and LPRXOne, filed for Chapter 11 protection on March 23 in the Eastern District of Missouri. On Sunday, affected customers received formal notice: if they want compensation, they must act soon.
This collapse follows a stormy 18 months for 23andMe. Sales dropped. Top executives left. Then came a major data breach in 2023 that shattered public trust. The company admitted that personal data from nearly 7 million users had been exposed. Leaked details included names, birth years, ancestry reports, DNA match data, and even self-reported locations.
The fallout was swift. Customers left in droves. Class-action lawsuits followed. And its digital health expansion — once seen as its next big thing — only worsened its financial strain. The $400 million acquisition of Lemonaid Health in 2021 never delivered the expected growth.
Now, customers affected by the breach — especially those notified between May and October 2023 — can file a Cyber Security Incident Claim. This applies if the breach caused financial harm or other personal damage. If users have unrelated issues, like problems with test results or telehealth services, they can file under the General Bar Date category.
It’s important to note that even those involved in the class-action lawsuit must file a separate bankruptcy claim. A proposed $30 million settlement is on pause due to the Chapter 11 filing. According to 23andMe’s legal team, that deal is now under dispute.
Congress is also keeping an eye on the case. Lawmakers have raised concerns about what happens to sensitive genetic and health data when a company in possession of it files for bankruptcy.
23andMe had big ambitions. It wanted to go beyond DNA kits and become a digital health powerhouse. But those plans stretched the company thin. Instead of growth, it triggered a financial spiral.
With the July 14 deadline approaching fast, current and former users are being urged to file their claims now to protect their rights. Ignoring this notice could mean losing the chance to recover damages — even for those already part of legal actions.
