Compensation for every user.. Court punishes Zoom for lying about protecting users

Zoom has agreed to pay $85 million to settle a case over providing false information about end-to-end encryption of users' data and providing user data to Facebook and Google without users' consent.

The settlement, between Zoom and the class action suitors, covers the security issues that led to the "Zoombombings" phenomenon.

The proposed settlement would generally give Zoom users between $15 or $25 each and was filed in US District Court for the Northern District of California.

This came 9 months after Zoom agreed to security improvements and "blocking privacy and security distortions" in a settlement with the Federal Trade Commission (FTC), but that settlement did not include compensation for users.

The FTC said Zoom claimed to provide end-to-end encryption in its direct responses to customer inquiries.

But in fact, "Zoom did not provide end-to-end encryption for any Zoom meeting that took place outside the Zoom Connecter product (which is hosted on the client's own servers), because Zoom servers - including those in China - keep encryption keys from It would allow Zum to access meeting content for its clients."

"In real end-to-end encryption, users can only access the keys needed to decrypt the content," the panel added.

The new group action settlement applies to Zoom users in the United States, regardless of whether they used Zoom for free or paid for an account.

Members who have paid for an account will be eligible to receive 15% of the money they paid to Zoom for their basic Zoom Meetings subscription during that period from March 30, 2016, to July 30, 2021, or $25.

In addition to payments, Zoom "has agreed to more than a dozen major changes to its practices that are designed to improve meeting security, enhance privacy disclosures, and protect consumer data," according to the settlement.

Zoom more than quadrupled its annual profit from $622.7 million to $2.7 billion (Shutterstock)

With the pandemic causing a surge in video conferencing, Zoom more than quadrupled its annual profit from $622.7 million to $2.7 billion in the 12 months ending Jan. 31, 2021.

It also recorded $672 million in net income for the 12-month period, an increase of $25.3 million over the past year 2020. Zoom is on track to achieve better results this year 2021, after it recorded revenues in the first quarter of $ 956.2 million and net income of $ 227.5 million.