23andMe - Audio of May 13 2025 Bankruptcy Court Hearing, case 2025-40976 before the US Bankruptcy Court for the Eastern District of Missouri, #bankruptcy, #privacy, #data, #genetics #sale #truecrime #23andMe

Twenty three and Me Holding Co.

My parents is in the courtroom, please.

Morning, your honor. Tom Riske, Carnegie McDonald on behalf of the debt. Morning.

Morning, your honor. Carol Gretchak on behalf of the US Trustee.

Morning. My parents is on the WebEx.

Good morning, Your Honor. Kevin Barnes, Class A shareholder.

Good morning.

Good morning, Your Honor. Charles Lucido, Class A shareholder. Your honor, I'd like to address the quarter at the end of the two agenda items if possible.

We'll we'll see

Morning, your honor. Jessica Choi.

We'll see how that goes. Miss Choi? Sorry.

Sorry about that. Good morning, Your Honor. Again, Jessica Choi, Paula with St. Wharton and Garrison on behalf of the debtors. I'll I'll I'll just say mine.

Good morning, your honor. Megan McLaughlin, Kelly Drenmore, and counsel to the committee.

Good morning.

Good morning, your honor. Michael Greger of Allen Mackenzie at Campbell Mallory Massas on behalf of Landlord KROP Tech LLC.

Right here.

Good morning, your honor. Tobias Keller, representing the class council.

Good morning.

Good morning, your honor. Matthew Langley representing plaintiffs for the lemonade pixel class action.

Pixel Class, okay. Anyone else on the WebEx? All right, Mr. Riske, are you leading the way?

Thanks, Your Honor. Tom Riske for the record. Yes, Your Honor, I think we have a pretty brief docket for today. Obviously, my colleagues and the folks at Moelis are spending a lot of their time preparing for tomorrow's auction. So I'm not sure we have a substantive update on the case generally other than that.

If it pleases the court, I think I'll just go in order of the agenda today. I can take take the rejection motion and then I'd ask Ms. Choi to kind of present the briefing issues with respect to class claimants and then allow your honor to ask any questions and do that if that works.

Sure. Since you mentioned an auction, I think if there's at least two bids? Correct.

We have multiple bids. I think there's still some issues going on with respect to potential other qualified bids, but we are still hoping for, as Mr. Hopkins said, a robust auction tomorrow.

Okay. Very good. Well, yes, why don't we take up the rejection motion then? Where do we stand on that?

Thank you, Your Honor. So I am pleased to report that the removal went smoothly last week. Everything was out as of Friday. However, as I've said previous times, there's still an additional step of the county and the fire department signing off on that to make sure everything was fine. It's my understanding that's in process.

Once we have that and I can get that to the landlord, I'm cautiously optimistic we'll be able to resolve this. So we do have an agreement to just adjourn this to next week's hearing.

Okay. Let's hold on for just a second. Are we on the record? Are we okay?

We're still on the record.

Everything is fine.

Okay. All

right. Sorry.

Go ahead.

No worries. I'm not sure Ms. Jones or Mr. Geiger are on today for the landlord, but I did speak with them even

this morning. I heard Mr. Greger.

Okay.

So we turn to next Tuesday, 01:30?

Correct, yes.

Okay. Mr. Greger, Ms. Jones, anything further on that? Or are we good with next Tuesday, 01:30?

Gregor, I think you're on mute.

Apologize, Your Honor. Nothing further. We're good for 01:30 next Tuesday.

Okay. Currently, I think that would be the only thing set on that calendar. So if it's resolved or you need another continuance, if you'd let Mr. Spiedle know, and we could just take care of that and wouldn't need to have everybody dial in for a non substantive hearing. But perhaps it will be resolved or perhaps there'll be something to dispute.

So we'll see how it goes.

Your Honor, the next matter that I previewed is with respect to the issue of briefing the class claims. We filed one stipulation with respect to one class of claimants and then late last night filed another resolution with pixel claimants. Ms. Choi from Paul Weiss is on. I'm not seeing her, but I saw her earlier.

Yes. She's on. I can see her.

We have

a different view, I guess. Oh, so there's nothing you can't see anything? Oh, got you. Okay. Yes, I can see Ms.

Choi is on, and so we can take comfort in that.

Okay. So with this, I'd ask if Ms. Choi has anything to put on the record with respect to the two court may have.

And Ms. Choi, you're muted.

Hi, Your Honor. Can you hear me?

Yes, there we go.

Okay, great. Jessica Chua with Paul Rice. I thought I would provide a brief update on the rule 7,023 briefing schedule. As Mr. Linsky noted, you know, the bar date order contemplates that the debtors and the committee would meet and confer with two sets of claimants.

First the main plaintiffs and the members of the settlement class have been conditionally and preliminarily approved, in the class actions currently pending before Judge Chen in the Northern District Of California. And second, with the main plaintiffs in the class action lawsuit currently pending before Judge Lin in in the Northern District Of California, which I will refer to as the PISCO litigation. I'm happy to report that the debtors have been able to agree on the rule of seventy twenty three schedule with those set of payments. Our schedule with the data breach payments is filed at docket number four zero one and our rule seventy twenty three schedule with the, fiscal payments is filed at, docket number four zero five. I'm happy to briefly go through what those briefing schedules contemplate your offer.

If your honor has specific questions, I'm happy to adjust this at this time.

Sure. I have them both in front of me, so I'm familiar with them. I guess a general question, is there is it beneficial to have separate hearings and separate tracks for these or would they benefit from being considered together?

I don't know

if we

want to disrupt the equilibrium here.

Yes. I mean, I think we've engaged in separate discussions, because the two class sessions are a bit, differently situated. And one notable difference, Your Honor, is that, our briefing schedule with the data breach claimants currently does not contemplate any discovery. So I think it would be efficient for the estate to proceed separately on a more expedited briefing scheduled time frame with the data breach payments. Our schedule with the pixel payments, however, there are consequences from discovery and we've met and conferred and tried to be efficient with the time and the estate's resources as much as possible.

And the fixed declaiments have agreed to, forgo that position for the time being, as well as the debtors. Secondly, to our right to seek that position at a later time, if the documents produced in responses to the interrogatories, proves to be insufficient or required further explanation. So given that, you know, the two matters are a bit differently situated in terms of where we stand on discovery and other issues, I do think it would be beneficial to proceed on, you know, on separate tracks.

Okay. All right. That's certainly fine with me. Then for scheduling, a minor issue for Pixel, a larger one for the cyber incident class. I have a trial on July 14.

It will be perhaps a half day trial. So I could hear you on the fifteenth on the Pixel class action, if that would make sense. I'm out of town on June 10 when you identified hearing date for the cyber incident. And then as you know, we have the sale here scheduled the next week. So that's a busy time.

So tell me what other constraints there are on scheduling a hearing for the cyber incident proof of claim from your perspective, Ms. Joy.

And Mr. Riske, did remind me that, the court might be unavailable the week of June 9. I have been able to get in touch with Mr. Teller, prior to this call and we will be amenable to pushing, all the dates in the data breach rule seventy twenty three briefing schedule by a week, so that the hearing such as the rule seventy twenty three motion for the data breach payments would be heard, sometime the week of June, sixteenth, if that would work for your Honor. I believe Mr.

Teller is attending as well. So Mr. Teller could speak up if he has any issues with that.

I can confirm the same, your Honor.

Okay. So here's what that week looks like. I really can't do it on the sixteenth given my travel schedule and the need to absorb what I assume is going to be a lengthy CPO filing, whatever comes before the sale hearing and the briefing on the cyber incident approved claim. So we have the sale hearing on seventeenth, we have a holiday on the nineteenth and I have a mediation on the twentieth. I have regular hearings scheduled on the eighteenth in the morning.

I don't know how expensive those will be at this point, but not something that will take all day. So one possibility would be to leave the seventeenth for the sale hearing. If it goes on, we could pick it up the afternoon of the eighteenth. Otherwise, we could schedule the cyber incident proof of claim hearing for the afternoon of the eighteenth. And if that's not enough time for that, we'd have to continue it probably to the following week.

How does that sound?

Our suggestion, we go ahead and take the eighteenth. We also are engaging in discussions with the debtor and there is some possibility that we will have a consensual resolution. So between the two of those, my fingers are crossed that we can get this resolved timely.

All right. I think we can work with that. We don't have anything scheduled at 01:30 in eighteen.

And just to confirm that, that will push out the remainder of the briefing schedule items with respect to the data breach payments. So right now, we have the deadline for the data breach payments to further the rule 7,023 motion on May 16. I think that would get kicked to May 23 and the other, deadlines that are contemplated in the data breach rule 7,023 motion would also get kicked, I think, by a week. I'm happy to file an updated notice from the docket, if that would be helpful.

I'll leave that up to you.

You and Mr. Keller know what the deadlines are. If it makes sense to clarify that on the record for any others who may be observing, that's certainly fine with me and maybe simplest considering how straightforward it would be to do that. So okay. So we'll schedule the hearing on the cyber incident proof of claim for $1.30 Central Time on Wednesday, June 18.

And if the sale hearing doesn't wrap up on the seventeenth, I guess, I'll defer to you as to which is more important to jump into on the afternoon of the eighteenth, considering we have a holiday the next day and time may be of the essence. So that will work. And then we'll schedule the pixel proof of claim hearing. Let's do we have West Coast Lawyers who will be participating remotely in that? Or should we start at nine a.

M. Central?

I'll refer to Mr. Langley, who I believe is online on behalf of the people who remember that nine a. M. Start with work.

Mr. Langley, I'm not sure where you're located, although I imagine you'll probably be in court to handle this.

Yes. So I'm in Chicago, so nine a. M. Central Time works works for us.

Okay. All right. So let's schedule that hearing at 9AM Central on Tuesday, July 15.

Great.

All right. And if the move ants, when they file their motion for leave to file the class proof of claim, if you would trigger that hearing date in ECF when you file and notice that out as well, then that'll make sure sure that the court's records keep up with what we're discussing here. Right. Okay. Anything further on either of those class proof claim matters?

No, Your Honor. Thank you.

Is there

risk anything further from the

debt issue? No, Your Honor. Thank

you. Nothing further from the debt issue.

Anything from the creditors committee?

No, Your Honor.

Okay. Mr. Basito, you mentioned that you wanted to make a comment?

Yes. It's more than a comment, your Honor. There was a to make the quote quarter where there was a post on the ex social media platform on May 6 by a former founder and officer of the company that was reposted 23 times with 14,000 views. The post was, well, based on what I'm hearing on the page of 23 andMe, I think it makes no sense for customers to download their data first then delete their accounts. Some of the more reputable bidders have decided to drop out given all the challenges 23andMe faces.

In the future, there may be great options to upload your S and P data files to other platforms

or for

a comprehensive analysis. And in my opinion, your honor, the confidential confidentiality stipulations and in the agreements in the bidding procedures has been violated, and the debtors' estate has been harmed. And all stakeholders, including the equity shareholders, have been prejudiced negatively based on any genetic database diminishing because of this post. In addition, the stock that was trading at May 6 for more than $1.2 a share yesterday and today was trading for less than $0.6 this year. In my opinion,

there might be negligence on

the part of the debtors that could be questioned. And it appears that confidential bidding information has and is being traded upon by privileged parties. I'm requesting release from the court to put all shareholders on equal footing and provide information that will allow the non represented parties the ability to potentially and appropriately object to any sales transaction because of the impact these breaches may have had on the bidding and sales process. And I could, go over that release that I would be requesting, But the bottom line, your honor, is this was an inappropriate approach. And in my opinion, the the confidentiality agreements have been have been violated in the bidding procedures.

Alright. Mr. Bassito, if there's relief that you want from the court, you'll need to file a motion and file that with the clerk of the court and serve that on the debtors and other parties who you think may be responsible, so that they can respond to that. As you know, anyone can post anything on Twitter. That doesn't mean it's true.

I have no basis to determine whether or not it's true. And so I don't have anything that I can act on based on your report of a post on Twitter earlier this month, Mr. Rasito. So if you'd like relief from the court, put it in writing, please, and follow it with the clerk of the court and serve it out and set for hearing, and we'll figure out what to do about it. And you can contact Mr.

Spiedle, the courtroom deputy, if you need information about the logistics of getting something filed and served. All right. Anything further to come from us?

Nothing, your honor.

Nothing, your honor. Thank you. Okay. We'll be adjourned. Thanks.