US Supreme Court to Hear Nvidia Crypto Mining Revenue Case
The U.S. Supreme Court has agreed to hear Nvidia Corporation’s appeal to dismiss a securities fraud lawsuit alleging the company misled investors about the size of its revenue from the cryptocurrency industry.
Nvidia’s Application to the Supreme Court
Nvidia’s appeal was heard by justices after the 9th U.S. Circuit Court of Appeals reopened a class-action lawsuit filed by shareholders against Nvidia and its CEO Jensen Huang.
The legal action was filed by Swedish investment management company E. Ohman J Fonder AB and sought an undisclosed amount of monetary damages.
As a result, Nvidia and its top executives are accused of making misrepresentations about the importance of cryptocurrency-related sales to the company’s revenue in 2017 and 2018.
Case History and Allegations
The lawsuit was initiated in 2018 with the main allegation that Nvidia violated the Securities Exchange Act of 1934. The defendants alleged that Nvidia failed to provide accurate information about the percentage of its revenue from crypto mining, a process that involves the use of GPUs. Solving mathematical problems in mining digital currencies such as Bitcoin.
This alleged negligence concealed from investors and analysts the fact that crypto mining was having a negative and significant impact on Nvidia’s business.
However, the lower court dismissed the case in 2021, but the 9th Circuit ruled in a 2-1 decision that the case could continue in the second half of 2021 because the plaintiffs plausibly alleged that Nvidia “knowingly made misleading or misleading statements.” recklessly “
Previous Settlements and Ongoing Litigation
Nvidia argued that the 9th Circuit’s decision could lead to “bad faith and speculative litigation,” so the company called on the Supreme Court to intervene. In 2022, Nvidia was charged by US authorities and the company was ordered to pay $5. 5 million for not adequately disclosing the impact of crypto mining on the gaming unit. However, this settlement did not prevent the shareholder lawsuit from moving to the next stage.
Separately, the justices ruled against Meta Platforms Inc., where shareholders of the social media company claimed the company misled investors about the misuse of user data. He also agreed to hear a similar case regarding him.
Earlier this month, US regulators launched an investigation into Nvidia, along with Microsoft and OpenAI, over possible antitrust issues in the AI market. These ongoing investigations are led by the Federal Trade Commission (FTC) and the Department of Justice (DOJ) and are directed to addressing market power and antitrust cases.
Also read: Top US SEC Executive Resigns After 9 Years of Service
✓ Share:
Kelvin is a distinguished author specializing in crypto and finance, with a bachelor’s degree in Actuarial Science. Known for her sharp analysis and insightful content, she is fluent in English and specializes in comprehensive research and on-time delivery.
The content presented may contain the personal opinion of the author and is subject to market conditions. Do your market research before investing in cryptocurrencies. Neither the author nor the publication accepts any liability for your personal financial loss.
#Supreme #Court #Hear #Nvidia #Crypto #Mining #Revenue #Case