Zoom has agreed to an $85 million settlement for a class action lawsuit that accused the company of improperly sharing user data through third-party software integrations with various digital platforms.
The preliminary settlement [PDF] was filed over the weekend and is currently awaiting court approval.
From March to May last year, 14 lawsuits were filed against Zoom, which then became a consolidated class action. In the lawsuit, the class members claimed Zoom misled users about its encryption capabilities, shared user data with digital platforms without consent, and had inadequate security and privacy controls, which resulted in zoombombings.
Zoombombings are unwanted and unauthorised interruptions of Zoom meetings by outsider participants. The US Department of Justice last year made zoombombing a crime, with people that conduct zoombombing liable to fines or arrests on a variety of state or federal charges.
The $85 million amount, if approved, would be allocated so that users who paid for an account will be eligible to receive the greater amount of either 15% of the money they paid to Zoom for their core Zoom Meetings subscription or $25 from April to October 2020. Meanwhile, other users who did not have a paying account may be eligible to receive up to $15.
While Zoom earned $1.3 billion in subscriptions from class members, the plaintiff's lawyers said the $85 million settlement was reasonable in light of the significant risks of litigation.
"Although plaintiffs firmly believe their liability case is strong and that class certification is warranted, it is uncertain whether the court ultimately would grant certification, deny a motion for summary judgment filed by Zoom, or ever find that plaintiffs are entitled to damages," the plaintiff's lawyers added.
Along with paying the $85 million payment, Zoom has also agreed to implement various changes focused on improving security, bolstering privacy, and safeguarding consumer data.
The company has agreed to provide in-meeting notifications to make it easier for users to understand who can see, save, and share Zoom users' information and content by alerting users when a meeting host or another participant uses a third-party application during a meeting.
Zoom will also not reintegrate the Facebook software development kit (SDK) for iOS into Zoom meetings for a year and request that Facebook delete any US user data obtained from the SDK.
In the settlement motion, the plaintiffs have also applied to have Zoom pay for its legal fees, which would amount to an additional $21.25 million.
If the settlement is approved, Zoom will have denied any wrongdoings that were alleged in the lawsuit.