- Three Bitcoin holders have sued Apple in a California federal court, alleging a counterfeit Sparrow Wallet app on the App Store led to combined losses of $1.8 million.
- The plaintiffs claim Apple ranked the fraudulent app in curated cryptocurrency collections, effectively recommending it to consumers.
- Sparrow Wallet developer Craig Raw has publicly flagged copycat iOS apps since January 2024, even facing a temporary account termination after trying to post a warning.
Three Bitcoin holders have sued Apple in the Northern District of California, alleging a counterfeit Sparrow Wallet app on the App Store drained a combined $1.8 million. The complaint, filed on July 24, brings eight counts including fraud, negligent misrepresentation, and strict products liability.
Each plaintiff entered a seed phrase into the app, according to the filing, with losses ranging from $120,000 to $875,000. Sparrow Wallet runs only on Windows, macOS and Linux and has never shipped an iOS version, making any App Store listing under that name an impersonation.
James Ramirez reported the app to Apple on July 25, 2025, but Christopher Ellis downloaded a Sparrow app from the store nine days later and lost $840,000. No one from Apple has contacted Ramirez about his report, and fraudulent Sparrow apps were still listed when the complaint was filed.
The filing also alleges that Apple ranked the fake app and included it in curated cryptocurrency collections, “effectively recommending a fraudulent application to consumers alongside legitimate ones.” Craig Raw, who built Sparrow Wallet and holds the U.S. trademarks, has flagged copycat Malware on the App Store since January 2024, tweeting that a scam version was still live weeks after being reported.
Raw stated that he submitted an App Store listing whose only purpose was to tell iOS users that Sparrow is desktop-only. Apple rejected it and flagged his developer account for termination over “dishonest activity,” a decision later reversed on appeal.
Apple declined to comment on the lawsuit to TechCrunch, instead pointing to an ecosystem analysis noting it rejected more than 371,000 malicious App Store submissions. Count seven asks the court to treat the App Store as a product, exposing Apple to strict liability for failing to warn.
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