Shareholders Accuse Huang Renxun of Deliberately Downplaying GPU Mining Revenue Supreme Court Accepts Nvidias Request to Withdraw Lawsuit

According to court documents, the United States Supreme Court has agreed to hear a request from artificial intelligence chip manufacturer Nvidia to dismiss a securities fraud lawsuit alleging that the company misled investors in 2017 and 2018 by downplaying revenue growth from cryptocurrency mining activities in a misleading manner.
The lawsuit was led by investment management company E. Ohman J Fonder AB based in Stockholm. The plaintiffs accuse Nvidia and its senior executives of violating the 1934 Securities Exchange Act by underestimating revenue growth associated with cryptocurrency mining activities in public statements 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 ruled to be reheard by the Ninth Circuit Court of Appeals in San Francisco by a vote of 2-1. The Ninth Circuit Court of Appeals found that the plaintiffs had adequately alleged that Nvidia CEO Huang Renxun had made false or misleading statements intentionally or recklessly.
Nvidia appealed to the Supreme Court, arguing that the Ninth Circuit’s decision 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 due to 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 from the U.S. Securities and Exchange Commission (SEC) regarding Nvidia’s failure to properly disclose the impact of cryptocurrency mining on its gaming division.