Zoom has been served with another class action lawsuit — this time by one of its shareholders, who says he lost money after the company “overstated” its security measures, which led its share price to tank.
The video conferencing giant has seen its daily usage rocket from 10 million users to 200 million
since the start of the coronavirus pandemic, which forced vast swathes of the world to stay and work from home. As its popularity rose, the company also
faced a growing number of security and privacy problems, including claims
that Zoom was not end-to-end encrypted as advertised.
Zoom’s later
admission saw the company’s share price fall by almost 20 percent.
Shareholder Michael Drieu, who filed the suit in a California federal court on Tuesday, said he and others have “suffered significant losses and damages” as a result. According to
the complaint, Drieu bought 50 shares priced at $149.50 but lost out when he sold the shares a week later at $120.50 per share.
Zoom did not respond to a request for comment.
It’s the latest class action served against Zoom in recent weeks. Zoom was slapped with another suit
last month after Zoom’s iOS app was found to have shared data with Facebook — even when users did not have a
Facebook account.
Zoom has doubled down on its efforts to improve its image in the past week, including a promise to
improve its encryption efforts and by
changing its default settings to prevent trolls and intruders from accessing Zoom calls without permission, coined “Zoombombing.” The security problems have
led to New York City schools banning Zoom in favor of Microsoft Teams. The Taiwanese government also
banned its agencies from using the app.
Just today, former Facebook chief security officer
Alex Stamos said he
joined Zoom as an advisor. Zoom also said it has enlisted security experts and leaders to advise on the company’s security strategy.
Zoom admits some calls were routed through China by mistake
