Catenaa, Thursday, December 12, 2024- The US Supreme Court on Wednesday declined to block a class-action lawsuit against Nvidia Corp., allowing investors to proceed with claims that the chipmaker misled them about its dependency on cryptocurrency mining. 1
The high court dismissed Nvidia’s appeal as “improvidently granted,” leaving in place a prior federal appeals court ruling that revived most of the case.
The lawsuit, initially filed in 2018, alleges Nvidia understated its reliance on crypto-related revenue, which led to a sharp drop in its stock value following a downturn in cryptocurrency mining profits.
Investors accuse Nvidia of inflating its stock by downplaying its exposure to the volatile crypto market.
The company countered by arguing the claims lacked merit under the Private Securities Litigation Reform Act, but the appeals court disagreed, citing sufficient evidence to allow the case to move forward.
The decision arrives amid mounting challenges for Nvidia, including a newly announced antitrust investigation by China and a $5.5 million settlement last year with the Securities and Exchange Commission over similar crypto-related disclosure issues.
The class action lawsuit has been filed against Nvidia, alleging that the company misled investors regarding its financial performance and the impact of cryptocurrency mining on its business. The suit claims that Nvidia failed to disclose how a decline in cryptocurrency mining demand would negatively affect its revenue, leading to inflated stock prices.
- https://www.supremecourt.gov/opinions/24pdf/23-970_2dq3.pdf[↩]
