T-Mobile to pay $350M to settle a class-action lawsuit following 2021 data breach

T-Mobile store sign
(Image credit: Android Central)

What you need to know

  • T-Mobile has agreed to pay a combined $500 million to settle a class-action lawsuit over a data breach that occurred in August of 2021.
  • The carrier will pay $350 million to pay lawyers, fees, and the customers.
  • The carrier must also spend $150 million on data security improvements over what it had already budgeted during 2022 and 2023.

In August of 2021, T-Mobile had a data breach that resulted in the data of millions of customers being exposed. As reported by the Verge, the carrier has agreed to pay a total of $500 million to settle a class action lawsuit over the data breach. This includes $350 million to pay lawyers, fees, and customers, plus $150 million the carrier must spend on information security over 2022 and 2023.

The data breach in August 2021 reportedly contained social security information, driver's license information, and other customer information. The Verge points out that this breach was the fifth in four years. At the time, it wasn't clear exactly how many customers were affected, although it's estimated that as many as 76.6 million customers were affected.

Once a judge approves, T-Mobile will have 10 business days to pay $35 million into a settlement fund for notice and administrative costs. T-Mobile will have 20 business days to pay the remaining $315 million into the settlement fund. You can read the full settlement text at the bottom of the article on The Verge.

T-Mobile must also spend $150 million on top of its budgeted baseline for data security and related technology in the aggregate years of 2022 and 2023. T-Mobile must also provide the Class Counsel with additional confirmatory information to show remediation for the data breach.

The carrier stated last year that it would invest in improving its security, going so far as to open a new Cyber Transformation Office that reports directly to CEO Mike Sievert.

T-Mobile also maintains that this settlement is not an admission of guilt with the lawsuit alleging the carrier failed to protect its customers' information. It's not yet clear how money affected customers will receive since the settlement must also pay for the lawyers and fees. It also depends on how many customers file claims. 

When Samuel is not writing about networking or 5G at Android Central, he spends most of his time researching computer components and obsessing over what CPU goes into the ultimate Windows 98 computer. It's the Pentium 3.