I don't think this is likely to succeed -- Zoom can argue that the stock price has gone down because of "Zoombombing" and security/privacy concerns that have nothing to do with exact details of what was disclosed in privacy/security documents, which barely anyone reads anyways.
Also, it's awfully hard to argue losing shareholder value when the stock has still more than doubled in the end -- Zoom can easily make the plausible-enough case that it made the right tradeoffs in the end for shareholder value that allowed it to scale. (I'm not saying that's true, just that it's plausible.)
Could it be fined by the SEC for misstating key details in their public filing? Maybe, although these are tiny details. But a class-action suit by shareholders? This feels like a stunt to me. Also, since a suit by shareholders could depress the stock price further, this feels like a short-seller trying to profit, no?
> Zoom can argue that the stock price has gone down because...
Two general steps to a securities suit.
First, show the company defrauded investors. That can be as simple as omitting or mis-stating material information. (Zoom publicly claimed to use certain encryption standards that it didn't.) So the battle, here, will be around materiality. Critically, this step does not typically require proving damages.
Once materiality is met, the second step is showing damages. At this point, the change in (and attribution of) stock prices comes into play.
Once fraud is shown, the company is in a bad place. Even if a particular investor faced no discernible loss, everyone who bought at higher prices will now sue. It also invites state and federal investigators to start pursuing management and senior staff.
> this feels like a short-seller trying to profit, no?
No. You have to disclose your positions when entering into a shareholder lawsuit. Shareholder lawsuits are comically common. And there is limited precedent for short sellers doing this.
Disclaimer: I am not a lawyer. This is not legal advice. Don't buy or sell securities based on my internet comments.
Also, it's awfully hard to argue losing shareholder value when the stock has still more than doubled in the end -- Zoom can easily make the plausible-enough case that it made the right tradeoffs in the end for shareholder value that allowed it to scale. (I'm not saying that's true, just that it's plausible.)
Could it be fined by the SEC for misstating key details in their public filing? Maybe, although these are tiny details. But a class-action suit by shareholders? This feels like a stunt to me. Also, since a suit by shareholders could depress the stock price further, this feels like a short-seller trying to profit, no?