AI Company’s Acquisition of Genetic Testing Firm Sparks Landmark Privacy Lawsuit – What Employers and MedTech Should Know | Fisher Phillips
https://www.jdsupra.com/legalnews/ai-company-s-acquisition-of-genetic-3569094/
Publish Date: 2026-04-23 18:49:00
Source Domain: www.jdsupra.com
A recent Illinois federal class action lawsuit alleges an AI healthcare company obtained health data during a corporate acquisition and shared that data with biotech and pharmaceutical companies in violation of key privacy laws. MedTech companies and their business customers should pay attention. The April 15 lawsuit targets Tempus AI, a Chicago-based healthcare technology company, and stems from its February 2025 acquisition of a genetic testing firm with a database of more than one million genetic tests. The plaintiffs allege that Tempus AI compelled the acquired firm to hand over its entire cache of genetic testing data shortly after the acquisition and then licensed their data to more than 70 pharmaceutical and biotech partners through agreements totaling more than $1.1 billion, all without providing notice, much less obtaining the written consent of the patients. What do employers and MedTech companies need to know about this new avenue of attack we’ll likely be seeing more of in the near future?
What the Lawsuit Alleges
Seven named plaintiffs from states across the country (Illinois, California, New York, Michigan, Florida, Georgia, and West Virginia) claim that they provided their genetic information to Ambry Genetics Corporation for medical testing purposes with the expectation that it would be kept confidential. When Tempus AI completed its $600 million acquisition of Ambry, the suit alleges, their data was swept up and transferred without notice or consent, then commercially exploited as training data for Tempus AI’s artificial intelligence tools and as a licensed dataset for third-party life sciences companies.
The complaint alleges Tempus AI’s revenue grew more than 83% year-over-year in 2025, and attributes much of that growth to the commercialization of the Ambry genetic data. The plaintiffs further allege that Tempus AI’s public statements that it only shares “de-identified” data don’t hold up. They argue genetic data is…
