Shareholders Accuse Huang Renxun of Intentionally Downplaying GPU Mining Profits Supreme Court Accepts Nvidias Request to Dismiss Lawsuit

Shareholders Accuse Huang Renxun of Intentionally Downplaying GPU Mining Profits Supreme Court Accepts Nvidias Request to Dismiss Lawsuit

Shareholders Accuse Huang Renxun of Intentionally Downplaying GPU Mining Profits Supreme Court Accepts Nvidias Request to Dismiss Lawsuit

According to court documents, the United States Supreme Court has agreed to hear the request of artificial intelligence chip maker Nvidia to dismiss a securities fraud lawsuit accusing the company of misleading investors in 2017 and 2018 by downplaying revenue growth related to cryptocurrency mining activities.

The lawsuit was brought by the Stockholm-based investment management company E. Ohman J Fonder AB. The plaintiffs allege that Nvidia and its senior executives violated the 1934 Securities Exchange Act by underestimating revenue growth associated with cryptocurrency mining activities in public statements made in 2017 and 2018. They argue that these omissions misled investors and analysts seeking to understand the impact of cryptocurrency mining on Nvidia’s overall business.

The case was initially dismissed by U.S. District Judge Haywood Gilliam Jr. in 2021, but was later ordered to be reconsidered by the Ninth Circuit Court of Appeals in San Francisco by a 2-1 decision. The Ninth Circuit Court of Appeals found that the plaintiffs had adequately alleged that Nvidia CEO Jensen Huang had made false or misleading statements intentionally or recklessly.

Nvidia appealed to the Supreme Court, arguing that the Ninth Circuit’s ruling could lead to frivolous and speculative lawsuits. The Supreme Court plans to hear the case in its next term in October.

In terms of products, Nvidia’s chips were widely used for cryptocurrency mining in 2018. In 2021, Nvidia also introduced the CMP 70HX graphics card designed specifically for mining.

Furthermore, Nvidia has faced criticism from gamers and professional content creators for selling a large number of products to cryptocurrency miners. In 2022, the company agreed to pay $5.5 million to U.S. authorities to settle related charges brought by the Securities and Exchange Commission (SEC) for allegedly not properly disclosing the impact of cryptocurrency mining on its gaming division.