Nvidia Crypto Lawsuit Continues With Company’s Failed Appeal
Key Points: The U.S. Supreme Court dismissed Nvidia’s appeal, accusing the company of misleading investors about its reliance on crypto-mining revenue before th...
Key Points:
- The U.S. Supreme Court dismissed Nvidia’s appeal, accusing the company of misleading investors about its reliance on crypto-mining revenue before the 2018 market crash.
- The Nvidia crypto lawsuit alleges that its CEO, Jensen Huang, concealed the crypto-driven growth of its GeForce GPUs.
According to Bloomberg, the U.S. Supreme Court has refused to review an appeal from Nvidia, paving the way for a lawsuit to continue alleging the company lied to shareholders about its crypto-mining revenue dependence.
Read more: Nvidia Stock Decline Shows Bitcoin Is Still Much More Stable
Supreme Court Allows Nvidia Crypto Lawsuit to Proceed
The Nvidia crypto lawsuit focuses on Nvidia’s financial disclosures that caused a market crash in 2018.
The lawsuit was filed by shareholders, and Nvidia CEO Jensen Huang concealed that its record revenue growth in 2017 and 2018 was driven by crypto-mining sales of its GeForce GPU products rather than by gaming.
These GPUs are crucial in the mining of cryptocurrency, which has quite a volatile market. Investors contend that when the crypto market abruptly collapsed in 2018, Nvidia was badly beaten, with the shares tumbling more than 28% the day after the company missed its forecasts in revenue. Later, Huang would go ahead to blame the shortfall on a “crypto hangover.”
Court Dismissal Marks Second Securities-Fraud Case Scrapped
Despite Nvidia’s effort to block the case by arguing that the lawsuit did not have enough specificity, the Supreme Court refused to take the appeal without explanation. That’s the second securities fraud case the court has declined to take this term. It also rejected a similar case involving Meta Platforms.
This will send the Nvidia crypto lawsuit back to a lower federal court in California. Investors are arguing that the company misled them about how much they could rely on its revenue sources, given how much of its sales were tied to crypto-mining during volatile times for the market. Nvidia settled with the SEC over similar claims for $5.5 million in 2020.
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Source: Coincu
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