A federal judge in California has significantly reduced the legal fees associated with the $150 million class-action lawsuit targeting Zoom Video Communications. The securities fraud litigation alleges the company made misleading statements concerning its encryption capabilities.
Upcoming Earnings in Focus
Market participants are now turning their attention to the upcoming financial results. Zoom is scheduled to announce its third-quarter earnings for fiscal year 2026 after market close on Monday, November 24, 2025.
This legal development arrives as investors assess the company’s recent trajectory. Zoom’s share price was last quoted at $81.69. The stock has experienced considerable volatility over the past year, trading within a 52-week range that saw a high of $92.80 and a low of $64.41. The interplay between these legal proceedings and the forthcoming quarterly report is expected to be a key driver of market sentiment in the near term.
Should investors sell immediately? Or is it worth buying Zoom?
Broader Legal Context
The case, officially known as “In re Zoom Securities Litigation,” accuses the company and its Chief Executive Officer, Eric Yuan, of misrepresenting the nature of its end-to-end encryption. While the proposed $150 million settlement itself still awaits final court approval, the recent ruling specifically addresses the attorneys’ costs related to the case.
This is not the first regulatory challenge Zoom has faced this year. Earlier, the U.S. Securities and Exchange Commission (SEC) concluded an investigation into Zoom’s privacy practices, resulting in a tentative $18 million settlement. The SEC ultimately decided not to pursue action regarding allegations of unlawful data exchanges with Chinese entities.
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