23andMe has agreed to a revised $50 million settlement (up from an initial $30 million) to resolve multidistrict litigation following a massive 2023 data breach. The incident, discovered in October 2023, involved a credential stuffing attack that compromised the sensitive personal and genetic information of nearly 7 million users. The lawsuit alleged that 23andMe failed to implement reasonable security measures, such as multi-factor authentication, and did not timely notify customers with Ashkenazi Jewish and Chinese ancestry that their stolen data was specifically targeted and sold on the dark web.
Who Was Eligible for the 23andMe Settlement?
The settlement was designed to benefit a broad class of users impacted by the security incident.
- Affected Users: Individuals who were 23andMe customers between May 1, 2023, and October 1, 2023, and received a formal data breach notification.
- Impacted Services: This included approximately 5.5 million users of the "DNA Relatives" feature and 1.4 million users of the "Family Tree" service.
- Residency: To qualify for the primary U.S. settlement, individuals must have been U.S. residents as of August 11, 2023.
Compensation Tiers and Payout Amounts
The revised settlement fund provides tiered cash payments and long-term security services for valid claimants.
- Extraordinary Claims: Users who could document actual financial hardships—such as identity fraud, falsified tax returns, or mental health treatment costs—were eligible for payouts up to $10,000.
- Standard Cash Claims: Eligible users without documented losses could claim up to $500 for undocumented expenses or a base payment of approximately $100.
- State-Specific Statutory Payments: Residents of Alaska, California, Illinois, and Oregon were eligible for $100 statutory payments due to specific state genetic privacy laws.
- Security Monitoring: All class members are entitled to five years of the "Privacy & Medical Shield + Genetic Monitoring" program, which includes identity theft monitoring and dark web protection.
Case Status and Bankruptcy Impact
The settlement process has been uniquely impacted by 23andMe's financial restructuring.
- Bankruptcy Filing: 23andMe filed for Chapter 11 bankruptcy in March 2025, leading to a court-supervised sale of the company for $305 million in July 2025.
- Claim Deadline: The final deadline to file an electronic claim was July 14, 2025.
- Final Approval Hearing: While preliminary approval of the increased $50 million deal was granted, final approval hearings for the U.S. and Canadian classes are scheduled for early 2026.
- Canadian Class: A separate $3.25 million (CA$4.49 million) settlement was reached for approximately 320,000 Canadian residents affected by the same breach.
Status of Current Payouts
Because the company is undergoing liquidation and finalizing insurance settlements, payouts have not yet been issued.
- Fraudulent Claims: The court recently expunged approximately 157,000 suspicious claims flagged for using non-matching email addresses or suspicious domains.
- Distribution Timeline: Cash payments and credit monitoring codes are expected to be sent to valid claimants following the final court sessions and plan consummation in 2026.
