Zoom zapped with a class action lawsuit

Zoom CEO Eric Yuan has apologised to users, saying he’s taking steps to fix the issues. (AP pic)

SAN JOSE: Zoom Video Communications was slapped with a class action suit by one of its shareholders Tuesday, accusing the video-conferencing app of overstating its privacy standards and failing to disclose that its service was not end-to-end encrypted.

A shareholder, Michael Drieu, on Tuesday accused the video-conferencing app maker of overstating its privacy standards and failing to disclose that it had not provided end-to-end encryption for its service.

The shareholder also claimed the string of recent media reports about the app’s privacy flaws have hurt the company’s high-flying stock.

Zoom Video Communications’ shares have lost nearly a third of their market value since hitting record highs in March. But they’re still up 67% so far this year, making them one of the few winners amid the massive market sell-off.

That’s because Zoom has mushroomed in popularity. Millions of new users worldwide have signed up as they’re forced to work from home amid lockdowns.

But the company is also facing a backlash from users worried about the lack of security and the phenomenon of “zoombombing,” where uninvited guests crash into meetings. SpaceX has banned staff from using Zoom.

Taiwan has barred agencies from using the app.

Zoom CEO Eric Yuan has apologised to users, saying he’s taking steps to fix the issues.

The company did not respond to a request for comment after market hours.