AT&T Moves to Dismiss Amended Crypto Fraud Suit

AT&T seeks to dismiss a lawsuit from crypto investor Mike Terpin stemming from a SIM-swap hack, arguing that he failed to read the company's terms and conditions and is partially responsible for the breach due to concealed security flaws and negligence. AT&T's motion requests dismissal of Terpin's claims of concealment and misrepresentation, as well as his request for punitive damages.

AT&T Files Motion to Dismiss Amended Crypto Investor Fraud Suit

Los Angeles, California - U.S. mobile communications behemoth AT&T has filed a motion to dismiss an amended lawsuit brought by cryptocurrency investor Mike Terpin, alleging that he fell victim to a malicious SIM-swap hack due to AT&T's negligence. AT&T contends that Terpin failed to adequately establish how the company concealed security flaws or misled him, and emphasizes that he admits to not having read relevant company documents.

Background of the Case

In August 2018, Terpin initiated a civil lawsuit against AT&T, asserting that an employee had been bribed to transfer control of his SIM card to an unauthorized party. Terpin claims that AT&T was aware of his elevated risk of a SIM-swap attack but failed to warn him or prevent the incident. He is seeking compensation of $23.8 million and punitive damages of $200 million.

AT&T's Motion to Dismiss

In its motion to dismiss Terpin's amended complaint, filed this week in the Central District of California federal court, AT&T argues that he has not provided sufficient evidence to support his claims of concealment and misrepresentation. Specifically, AT&T alleges that:

1. No Evidence of Concealment: Terpin has failed to demonstrate how AT&T concealed any alleged deficiencies in its data security system or actively misled him about its practices.
2. Lack of Reliance on Written Documents: Terpin has conceded that he did not read the privacy policy and code of business conduct documents that he claims AT&T misrepresented. Therefore, AT&T maintains that Terpin cannot base his misrepresentation claim on written materials that he did not rely on.

Previous Motion Denied

A previous motion to dismiss filed by AT&T in February was denied by a judge, allowing Terpin 21 days to file an amended complaint that addressed the deficiencies identified by AT&T. The current motion to dismiss pertains to this amended complaint.

Similar Case

In December 2023, AT&T filed a similar motion to dismiss a lawsuit brought by another cryptocurrency executive who suffered a phone hack. AT&T argued that the case contained "critical holes" in its allegations.

Conclusion

The outcome of AT&T's motion to dismiss will significantly impact the ongoing legal battle between the company and Terpin. If the motion is granted, Terpin will be barred from pursuing his claims against AT&T. The proceedings will continue to be closely monitored as the case progresses through the judicial system.