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Zoom faces a lawsuit after privacy, security concerns led to plummeting stocks
Zoom has come into the spotlight recently as the platform’s numerous privacy and security concerns have surfaced. The company behind the app enacted a 90-day feature freeze to address these problems, but this was too little too late. According to Reuters, Zoom shareholder Michael Drieu recently filed a class-action lawsuit against the company.
Drieu claims Zoom overstated its privacy standards and failed to disclose the fact that the app is not end-to-end encrypted. Because of this, Zoom’s stock prices have plummeted, and investors are losing money.
Zoom stocks have lost nearly a third of their market value in the last couple of weeks. They dropped by more than 7% this Tuesday alone, coming in at $113.75 at the end of the day.
There’s still hope for Zoom, though. According to Bloomberg, shares are still up 67% this year as investors bet the app will make it out of this slump and continue growing after the coronavirus pandemic is over.
Zoom has yet to make an official statement regarding the lawsuit.