Three iPhone users are suing Apple in federal court, alleging that a counterfeit cryptocurrency wallet app that passed the App Store’s review process cost them a combined $1.835 million in Bitcoin.
The complaint, filed Friday in the U.S. District Court of Northern California, names James Ramirez, Christopher Ellis, and Jalen Delgado as plaintiffs.
Ramirez lost approximately $875,000, Ellis lost around $840,000, and Delgado lost roughly $120,000 after each downloaded what appeared to be Sparrow Wallet, a well-known Bitcoin wallet. The legitimate Sparrow Bitcoin wallet has never been available on iOS.
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A Fake App That Cleared Apple’s Review
The fraudulent app closely impersonated Sparrow Wallet, fooling users actively looking for the software. After transferring their Bitcoin holdings into the fake app, the plaintiffs found their funds gone.
The lawsuit argues Apple bears responsibility because it has built its entire consumer pitch on the premise that its review system prevents exactly this kind of fraud from reaching iPhone users.
Craig Raw, who created the real Sparrow Bitcoin Wallet, had already publicly called out Apple for allowing copycat versions of his app to remain listed on the App Store.
The complaint cites his criticism as evidence that Apple was aware the problem existed and did not act quickly enough to remove the fraudulent listings.
Apple’s Safety Claims Are Now the Legal Target
The lawsuit directly challenges the security guarantee Apple has used for years to justify keeping iPhone software distribution exclusive to its own storefront.
Apple has long argued that its mandatory app review process is what separates its platform from Android, where users can install software from outside official channels.
That argument has also been central to Apple’s lobbying against regulatory efforts to require third-party app stores on iPhones.
The filing quotes Apple’s own marketing language, accusing the company of running a sustained campaign promising users that apps distributed through its store are safe and trustworthy.
By controlling every app that reaches iPhone users, the complaint argues, Apple created a situation where consumers have no choice but to rely on that promise.
Apple declined to comment on the litigation. The company told TechCrunch that apps impersonating other software violate its guidelines and that it removes them quickly. Apple also said no Sparrow Wallet impostors are currently listed on the App Store.
In May 2025, Apple published data showing it had rejected more than 371,000 app submissions the prior year for copying other apps, containing spam, or misleading users.
What the Plaintiffs Are Asking For
The three users are requesting a jury trial and seeking full reimbursement of their losses along with additional damages.
The lawsuit also asks the judge to force Apple to post clear risk warnings on the App Store. If granted, that requirement would undercut Apple’s main marketing pitch that its curated marketplace is fundamentally safe and secure.
