Overview

A class action lawsuit has been filed against ZoomInfo Technologies, Inc. (“ZoomInfo” or the “Company”) (NASDAQ: ZI) and certain of the Company’s senior executive officers and controlling shareholders alleging violations of the federal securities laws.  The ZoomInfo class action lawsuit is brought on behalf of all persons and entities who purchased or otherwise acquired ZoomInfo Class A common stock between November 10, 2020, and August 5, 2024, both dates inclusive (the “Class Period”).  Investors have until November 4, 2024, to seek appointment as lead plaintiff of the ZoomInfo class action lawsuit.

ZoomInfo is a software and data company that provides customer analytics and intelligence to sales and marketing teams.  Its principal product is a data platform that provides customer contact and business information to its clients.  ZoomInfo claims that its platform, data, and customer intelligence allow its clients to sell and market more effectively by enabling them to target organizations and personnel with optimal messaging and timing.  ZoomInfo sells access to its platform through non-cancelable subscription contracts with terms ranging from one to three years.  Subscription pricing is generally based on the number of users or “seats” accessing ZoomInfo’s applications, the amount of functionality sought by the customer, and the amount of data utilized.  Revenue is generally recognized ratably [SC1] over the life of the contract beginning with when the service is first made available to the customer.  Under ZoomInfo’s standard billing terms, customers are typically required to pay for services at the beginning of each annual, semi-annual, or quarterly period.

During the Class Period, ZoomInfo claimed to have a customer base of 35,000 companies, comprised of large enterprise customers, mid-market companies, and small businesses.  Throughout the Class Period, ZoomInfo claimed that its customer base was “diversified” and that no single customer contributed more than 1% of its total annual revenues.  ZoomInfo provides investors with measures of underlying client demand and anticipated future business performance, in part, through two operational metrics: (1) Net Revenue Retention (NRR); and (2) Remaining Performance Obligations (RPOs).

Due to favorable market dynamics created by the COVID-19 pandemic, ZoomInfo experienced growth in 2020 and 2021.  Specifically, as social distancing restrictions made traditional in-person sales and marketing activities unavailable, businesses emphasized digital sales and marketing campaigns, which in turn, significantly increased demand for ZoomInfo’s database of digital contact information.  Amid these market shifts, ZoomInfo executives highlighted purported client and revenue growth.

The ZoomInfo class action lawsuit alleges that Defendants, throughout the Class Period, made false and/or misleading statements and/or failed to disclose that: (1) ZoomInfo’s financial and operational results during the Class Period had been temporarily inflated by the ephemeral effects of the COVID-19 pandemic, which had pulled-forward demand for ZoomInfo’s database of digital contact information; (2) material portions of ZoomInfo’s existing customer base were attempting to either substantially reduce their use of ZoomInfo’s product or abandon it altogether; (3) ZoomInfo had used manipulative and coercive auto-renew policies and threats of litigation to force customers into remaining with ZoomInfo for an additional contractual term even though such customers did not want to; (4) ZoomInfo’s coercive customer retention tactics had materially damaged ZoomInfo’s customer relationships, client franchise, and competitive advantages, and created a hidden demand cliff for costumer contract renewals in future periods; and (5) as a result of all of the above, ZoomInfo’s reported revenues, operating income, and customer and retention metrics were materially overstated.

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If you purchased or otherwise acquired ZoomInfo Class A common stock between November 10, 2020, and August 5, 2024, both dates inclusive, and you wish to serve as lead plaintiff in this lawsuit, we encourage you to submit your information to DiCello Levitt LLP via the form on this page. 

You can also contact DiCello Levitt partner Brian O’Mara by calling (888) 287-9005 or at investors@dicellolevitt.com. 

The deadline to apply to the Court to serve as a lead plaintiff in the ZoomInfo class action lawsuit is November 4, 2024.