A new 9-Count Class Action has been filed against Apple for allowing a Phishing App in the App Store disguised as a Cryptocurrency Wallet
Apple's long-standing mantra has been that the App Store "is the safest and most trusted place for users to get apps." Yet a new 9-count class action filed against Apple disagrees. It's being reported that cryptocurrency users who downloaded an Apple application called "Toast Plus" saw their money disappear, and now they're suing Apple over it in a class action lawsuit that was filed yesterday.
According to the complaint filed in federal court in Maryland, Apple allowed hackers to place a spoof or "phishing" application disguised as a cryptocurrency wallet in its on-line App Store, inducing the plaintiff and others to download and install a criminal portal into their crypto accounts.
The complaint, alleging negligence, fraud and a host of computer-specific privacy torts, was filed on behalf of Maryland resident Hadona Diep by Joshua Whitaker of the Baltimore law firm Aldelphi Law.
Apple is liable because it failed to vet the software distributed by its online store, which it tightly controls by allowing only approved vendors and extracting a (until recently) 30% commission on every sale, the lawsuit says, adding that the boilerplate disclaimers in its user agreement don't apply: "The fact that Toast Plus was not an actual application, but instead a medium for the commission of fraud, makes any existing contract using it as subject matter void."
Users of the Toast Plus app found it anything but trustworthy, according to the lawsuit.
"Plaintiff believed that Toast Plus was a version of Toast Wallet, a well known cryptocurrency wallet, as the names were similar and the logo used for the application in the App Store was the same or nearly identical," the lawsuit says.
In January of 2018 Diep transferred 474 Ripple ("XRP") cryptocurrency coins to a cryptocurrency wallet which was shut down the next month.
"Plaintiff thereafter linked her private XRP key, or a seed phrase, into Toast Plus in March of 2021," the complaint says, but did not transfer any of the money because she was holding the coins as an investment.
Months later, in August, she checked the wallet to find that her cryptocurrency was gone. In fact, according to the lawsuit, she "discovered that not only did she have no XRP in the Wallet, her account was 'deleted' on March 3, 2021."
Calls to the Toast Plus company, Apple and then law enforcement followed, according to the complaint, but no one took responsibility. The lawsuit says she lost more than $5,000.
An online message board frequented by cryptocurrency users tells a similar story.
"I went to the App Store and downloaded the first wallet that came up," a user calling themself Badinker wrote at ycombinator's message board in March. "So, I went ahead and imported the private key and instantly before I could send the exchange all the XRP was transferred to . . . a known scam account."
The complaint says anyone who downloaded the Toast Plus software is part of the class, "entitled to statutory damages of the greater of $10,000 or $100 per day for each day of violation, actual and punitive damages, reasonable attorneys’ fees, and Defendant’s profits obtained from the above described violations."
Causes for Action
Count 1: Violations of the Computer Fraud and Abuse Act
Count 2: Violations of the Electronic Communications Privacy Act
Count 3: Interception of Electronic Communications in Violation of Md. Code
Count 4: Disclosure of Electronic Communications in Violation of Md. Code Ann., Wiretap & Electronic Surveillance Act
Count 5: Violation(s) of the Maryland Personal Information Protection Act
Count 6: Violation(s) of Each State's Personal Information Protection Acts
Count 7: Violation(s) of the Maryland Consumer Protection Act
Count 8: Violation(s) of the Each State's Consumer Protection Act
Count 9: Negligence
For more details on this case, review the full Class Action lawsuit filing presented below in a Scribd document.