Terpin Fires Back at AT&T’s Motion to Dismiss $200M ‘SIM Swap’ Claim

Crypto investor Michael Terpin has filed an opposition to telecom giant AT&T’s motion to strike out his $200 million punitive damages claim in the long-running SIM swap case

Terpin was the victim of attacks in 2017 and 2018 and lost $24 million in cryptocurrency. The investor asserts that his device was compromised as a result of AT&T’s negligence.

A SIM swap attack typically occurs when a criminal tricks a carrier into switching a victim’s phone number to a SIM card they control, in order to accept 2FA prompts. This allows a scammer to steal cryptocurrency. 

Terpin told Cointelegraph he was frustrated with AT&T’s ongoing attempts to waste time and money in court to “slow down the day of reckoning”. AT&T called the attacks “unfortunate” but said it was determined to continue to fight the case. 

Terpin opposes AT&T motion to dismiss

Terpin filed his opposition to AT&T motion to dismiss on April 13, arguing that AT&T’s “representatives made specific false representations” concerning the robustness of the security systems.

He also contends that the telecom conglomerate has sought to obfuscate relevant facts through repeatedly seeking the case’s dismissal since it was filed in 2018. 

Terpin claims misrepresentations were made by AT&T’s staff in a bid to retain Terpin as a customer after his phone was breached in the initial 2017 SIM attack as a result of cooperation between AT&T employees and criminal actors. 

In 2018, the second attack saw Terpin’s SIM reassigned to hackers who were then able to impersonate the investor and gain access to $24 million worth of his crypto holdings.

AT&T accused of deceit

The filing asserts that “AT&T’s attempt to strike the punitive damages claim similarly rests on a seemingly willful distortion of Plaintiff’s allegations regarding AT&T’s involvement in the SIM swaps”: 

“Mr. Terpin’s primary argument is that AT&T through its corporate officers and managing directors created an inadequate ‘security’ system that allowed its employees and contractors to bypass controls to implement SIM swaps.” 

‘We know we are in the right’

Speaking to Cointelegraph, Michael Terpin stated: “We are eager to start discovery, we know we are in the right, and I am more determined than ever now that I see the response of AT&T and its lawyers."

“It's frustrating to see AT&T spend so much time and money on challenging every aspect of the filing in an effort to slow down the day of reckoning and to attempt to confuse the Court through application of completely irrelevant and misleading case law examples."

Of the eight claims levied against AT&T, the firm is pushing against just two in arguing the $200 million damages claims should be dropped — deceit by concealment, and deceit by misrepresentation.

Terpin predicts eventual victory

Despite his frustrations, Terpin notes: “every time we have been provided the opportunity by the Court to amend a complaint to specifically point out the flaws in AT&T's counter-arguments, we have prevailed."

AT&T’s Jim Kimberley told Cointelegraph: “Fraudulent SIM swaps are a form of theft committed by sophisticated criminals. It is unfortunate that these criminals targeted Mr. Terpin, but we dispute his allegations and will continue to fight them in court.”