T-Mobile reaches $350M settlement over 2021 data breach

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T-mobile data breach settlement overview: 

• Who: T-Mobile will pay $350 million and boost its data security thanks to a new legal settlement
• Why: The settlement will end claims from millions of people whose data was allegedly exposed in a 2021 breach
• Where: Missouri federal court

T-Mobile has agreed to a $350 million settlement to resolve claims it exposed more than 76 million Americans’ personal information in a 2021 data breach. 

The proposed settlement was filed July 22 in a Missouri federal court. According to court documents, the settlement would provide monetary reimbursement of up to $25,000 for out-of-pocket losses resulting from the data breach. 

It would also compensate data breach victims for their time spent addressing losses resulting from the data breach at $25 per hour, and provide two-year subscription services to identify theft protection services. 

T-Mobile has also agreed to spend at least $150 million for data security and related technology for 2022 and 2023 to improve its network and data security and address vulnerabilities that resulted in the data breach, the company said. 

“Considering the substantial and meaningful cash and non-monetary benefits conferred upon Settlement Class Members, valued at well over $500 million, and the significant risks faced through continued litigation, the terms of the Settlement are ‘fair, reasonable, and adequate’ in accordance with Federal Rule of Civil Procedure,” a memo in support of the motion for preliminary approval states.

Millions of customers’ data compromised

The settlement comes after T-Mobile was hit with a lawsuit alleging that, sometime in 2021, one or more cybercriminals exploited T-Mobile’s data security protocols and gained access to internal servers containing the personally identifiable information of millions of current, former and prospective T-Mobile customers. 

“After exfiltrating a purported 106 GB of this data, the hacker or hackers offered to sell a subset of the stolen PII via a dark-web forum,” the memo states. 

In November 2021, T-Mobile revealed in a U.S. Securities and Exchange Commission filing that its investigation had identified about 76.6 million people whose “names, dates of birth and, in many cases, addresses” were compromised.

During the weeks and months following the breach, the plaintiffs allege they and other class members suffered identity theft and fraud. 

Under the deal, attorneys could also seek up to 30% of the $350 million settlement fund, or $105 million.

T-Mobile has been the target of class action litigation in the past.

A class action lawsuit filed in June alleges the April 2020 merger between T-Mobile and Sprint was an anticompetitive acquisition and collectively cost U.S. small businesses and AT&T and Verizon subscribers billions of dollars. 

Another recent class action against T-Mobile alleges the company launched a 5G network without telling customers it planned to shut down older networks, and didn’t address network incompatibilities for certain phones.

Were you affected by the data breach? Let us know in the comments! 

The plaintiffs are represented by Norman Eli Siegel of Stueve Siegel Hanson LLP, Cari Campen Laufenberg of Keller Rohrback LLP and James J. Pizzirusso of Hausfeld LLP.

The T-Mobile data breach class action settlement is In re: T-Mobile Customer Data Security Breach Litigation, Case No. 4:21-md-03019, in the U.S. District Court for the Western District of Missouri.

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