It's not a violation of the free speech guarantees of the constitution, which is what people are usually discussing when that line comes out. I don't think what Zoom did should be illegal. That said...

There have recently been a whole lot of apologists saying "yes their founder is from China and their developers are in China but that doesn't make them a Chinese company". Fair enough, but when that company further starts intentionally enforcing Chinese law on US customers, I have no problem calling it a Chinese company. And I will not use a Chinese company's communication product unless forced to.