Nvidia, a well-known American chipmaker, has encountered a setback in a class action lawsuit filed by shareholders in 2018.
The US Supreme Court has declined to hear Nvidia's appeal, allowing the lawsuit to proceed in lower courts. The lawsuit alleges securities fraud related to Nvidia's cryptocurrency revenue disclosures. Shareholders claim that Nvidia misled investors about the extent to which its sales were influenced by the volatile cryptocurrency market. They argue that the company failed to provide transparent information about the proportion of its revenue growth attributable to crypto-related activities.
Initially, a federal judge dismissed the lawsuit in favor of Nvidia, but the 9th US Circuit Court of Appeals later overturned this decision. The Supreme Court's recent announcement not to entertain Nvidia's appeal means that the lower court's ruling will stand. This decision reflects a trend of courts being cautious about intervening in cases involving complex financial and technological matters, particularly in rapidly evolving sectors like cryptocurrency.
The outcome of this lawsuit could have significant implications for Nvidia and other companies in the tech and crypto sectors, potentially leading to stricter regulations and greater accountability for financial disclosures.