Zoom, a popular video conferencing platform, has agreed to pay $85 million to settle a lawsuit claiming it has violated users’ privacy rights. The lawsuit bolsters its security practices by sharing personal data with other social giants including Google, Facebook, and LinkedIn, and letting hackers disrupt meetings in a practice called Zoombombing.
Zoombombing is when outsiders hijack a meeting on Zoom and use racist language, display pornography, or post other disturbing content.
On Saturday, a preliminary settlement was filed in the afternoon that requires approval by US District Judge in San Jose, California.
In the proposed class action, Zoom’s subscribers would be eligible for 15% refunds on their core subscriptions or $25, while others will receive up to $15.
Meanwhile, the company has agreed to add security measures including alerting users when hosts or other participants use third-party apps and providing specialized training to employees on privacy and data handling.
On Sunday, in a statement, Zoom said: “The privacy and security of our users are top priorities for Zoom, and we take seriously the trust our users place in us.”
In Zoom Meetings subscriptions, Zoom collected about $1.3 billion from class members. Given the litigation risks, the plaintiffs’ lawyers called the $85 million settlement reasonable. The lawyers intend to seek up to $21.25 million for legal fees.
Zoom was almost immune for Zoombombing under the federal Communications Decency Act, shielding online platforms from liability over user content.
Since the COVID-19 pandemic, Zoom’s customer base has grown sixfold as more and more people shifted to work from home. At the beginning of the pandemic, the company had 497,000 customers in April 2021, up from 81,900 in January 2020.
However, the company said that user growth could slow or decline as more people start returning to work or school in person.