$ZM: AI-Powered CX Push — Yet $150M Security Settlement Persists

Court: N.D. California

Case: 3:20-cv-02353

Zoom is leaning into AI-first customer support with omnichannel tools, predictive routing, and agent-grade platforms to boost digital experiences. But even as it builds the future of customer interactions, the company still carries the weight of a $150 million settlement over past encryption and privacy missteps.

• New AI-assisted voice + chat routing to deliver faster customer resolutions.
• Stronger knowledge management to reduce AI hallucinations and improve accuracy.
• Omnichannel strategy spans phone, chat, text, social, and web bots.
• Focus on agent experience, providing better tools than customers themselves.
• $150M settlement over security and data-sharing issues continues to weigh on reputation.

Timeline Overview

• Jul 2019: Reports flagged encryption flaws.
• Mar 26–27, 2020: Data-sharing disclosures led ZM to drop 19%.
• May 18, 2020: Investors sued over misleading security claims.
• Jul 12, 2023: Zoom agreed to $150M settlement with investors.

Allegations Include

• Misrepresenting end-to-end encryption capabilities.
• Exposing user data to third parties, including Facebook.
• Downplaying hacker vulnerabilities in its platform.
• Misleading investors about data privacy safeguards.

Investor Update

• $150M cash settlement resolves litigation but dents trust.
• Investors remain focused on growth of AI-driven contact center products.
• Ongoing need to prove security-first credibility alongside CX innovation.

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