23andMe Wins Eighth Circuit Decision Allowing Sale to Move Forward

Paul, Weiss secured a pivotal victory for 23andMe Holding Co., a leading human genetics and biotechnology company, when the Eighth Circuit rejected the state of California’s attempt to block the company’s sale to TTAM Research Institute, a California nonprofit led by 23andMe co-founder and former CEO Anne Wojcicki.

The Eighth Circuit denied California’s emergency motion to stay the bankruptcy court-approved $305 million sale while the district court reviews the state’s legal challenge, which asserts that 23andMe cannot sell California customers’ genetic data without their consent. An administrative stay put into place by the district court on July 8 to allow California time to appeal the decision to the Eighth Circuit expired at 1 a.m. ET on July 12, and the sale—on which Paul, Weiss also advised—closed.

Under the terms of the transaction, announced on June 13 and approved by the U.S. Bankruptcy Court for the Eastern District of Missouri on June 27, TTAM acquired substantially all of 23andMe’s assets, including the Personal Genome Service and Research Services business lines and the Lemonaid Health business.

The agreement is the result of a final round of a competitive bidding process approved by the bankruptcy court, and replaces a previously announced acquisition and underlying asset purchase agreement with Regeneron to acquire 23andMe for $256 million. The transaction is aligned with 23andMe’s privacy statements, as TTAM has affirmed its commitment to comply with the company’s privacy policies and applicable law. TTAM has also made binding commitments to adopt additional consumer protections and privacy safeguards to enhance protections for customer data and privacy.

The bankruptcy court approved the transaction following a two-day hearing in June, during which the Paul, Weiss team successfully countered data privacy-related objections by several states. In approving the sale, the judge held that, under the transaction, “customers are likely to have the same or better experiences (with respect to privacy and otherwise) with TTAM as they have with the Debtors today.”

The Paul, Weiss team is led by partners Christopher Hopkins, Jeffrey Recher, William Clareman, Paul Basta and Jeffrey Marell, and includes litigation partners John Carlin and Kannon Shanmugam and counsel Audrey Paquet; corporate counsel Lyudmila Bondarenko, Robert Balis and Nathan Mitchell; tax partner Robert Holo; intellectual property partners Bonnie Chen and Claudine Meredith-Goujon; environmental partner Stefanie Gitler; and antitrust counsel John Magruder.