Federal Judge Approves $85 Million Settlement in Zoom Case

A federal judge in California approved an $85 million settlement between Zoom Video Communications and millions of users who said the teleconference meeting application violated their privacy rights by sharing personal data to companies such as Facebook and Google, and allowing hackers to disrupt meetings in what became to be known as “Zoombombing.”

According to documents filed late last week, Judge Laurel Beeler of the U.S. District Court in the Northern District of California said the settlement was fair to the approximately 150 million settlement class members and Zoom, which denied any wrongdoing and agreed to a number of improvements to protect users’ privacy and data, and bolster security.

“Safety, security, and privacy are at the core of how we make decisions at Zoom and enhance our platform,” said Jason Lee, chief information security officer of San Jose, California-based Zoom, in a statement announcing recent platform enhancements. “We remain committed to being a platform that users can trust for all of their online interactions, information, and business.”

Class members that paid for a Zoom subscription will receive the great of $25 or 15% of the amount paid. Claimants who did not pay for a subscription can submit a claim and get $15, according to the settlement, which noted Zoom, which gained popularity and was used widely during the COVID-19 pandemic, collected about $1.1 billion in subscriptions from class members. The settlement had about 10 objections but the judge ruled they lacked standing or put forth ineffective arguments.

‘Zoombombing’ Costs Zoom $85 Million Privacy Settlement

Funds available to the settlement class will be what’s left after about $21.4 million in fees and costs to the class counsel as well as service charges of $5,000 per plaintiff, settlement administration expenses of about $2.8 million, and taxes and tax expenses.

Co-lead counsel Mark Molumphy of Cotchett, Pitre & McCarthy said in a statement the “groundbreaking settlement will provide a substantial cash recovery to Zoom users and implement privacy practices that, going forward, will help ensure that users are safe and protected.”

The settlement “recognizes that data is the new oil and compensates consumers for unwittingly providing data in exchange for a ‘free’ service. It also compensates those who paid for a product they did not receive and commits Zoom to changing its corporate behavior to better inform consumers about their privacy choices and provide stronger cybersecurity,” added co-counsel Tina Wolfson of Ahdoot Wolfson.

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Topics Legislation