Shareholder Michael Drieu said in a court case that a series of recent media reports highlighting breaches of confidentiality in Zoom’s application had led to the collapse of the company’s shares, which had gathered for several days at the start of the year.
On Tuesday, the company’s shares closed at 7.5% at US $ 113.75. They have lost almost a third of their market value since the records reached at the end of March.
Zoom CEO Eric Yuan apologized to users last week, saying that the company had failed to meet community expectations for privacy and security and that it was taking steps to solve problems.
Zoom has tried to plug in security concerns because it is recruiting millions of new users around the world, as people are forced to work from their homes after the system locks out to slow the spread of the coronavirus.
However, the company is facing a reaction from worried users about the lack of end-to-end encryption in meeting sessions and “zoom bombardment”, where uninvited guests rush into meetings.
Elon Musk’s rocket company SpaceX recently banned its employees from using Zoom, citing “significant privacy and security concerns”.
Zoom did not respond to a request for comment from Reuters after hours.
The file number is 5: 20-cv-02353 and it has been filed with the United States District Court for the Northern District of California.