The state of California is pushing back against the controversial bankruptcy sale of 23andMe’s DNA database, urging a Missouri federal judge to unravel the $305 million transaction that transferred genetic data of nearly 2 million Californians to a nonprofit linked to the company’s co-founder.
In a sharply worded appellate brief filed Friday, California accused 23andMe Holding Co. of sidestepping the state’s Genetic Information Privacy Act (GIPA) by selling genetic profiles without the affirmative consent of customers.
A Sale Built on Legal Fault Lines
The deal, approved in June by U.S. Bankruptcy Judge Brian C. Walsh, allowed 23andMe to funnel customer DNA data into a newly created affiliate, then sell that entity’s equity to TTAM Research Institute—a nonprofit established by former CEO Anne Wojcicki.
California argues this so-called equity toggle structure was engineered to skirt GIPA’s strict requirements on DNA sharing.
“There is no exemption for affiliates,” the state wrote. “The court erred by reading in an implicit loophole where none exists.”
