Nvidia to Face Class Action Lawsuit Over Alleged Crypto Mining Revenue Gaps
Nvidia faces a class action lawsuit alleging it concealed over $1 billion in crypto-related GPU sales between 2017 and 2018.Summary
Nvidia is set to face a certified class action lawsuit brought by investors who claim the company hid the significant impact of cryptocurrency mining on its GPU sales between August 10, 2017, and November 15, 2018. Investors allege Nvidia concealed over $1 billion in crypto-related GPU sales and that CEO Jensen Huang downplayed the scale of this demand. A federal judge, Haywood S. Gilliam Jr., certified the class after determining Nvidia couldn’t demonstrate its statements about crypto mining revenue had no effect on its stock price.
The lawsuit stems from Nvidia’s initial claims that crypto mining accounted for only a small portion of its business, while internal communications revealed executives believed the company’s stock price was bolstered by these statements. The case was revived after a 2021 dismissal and a failed appeal to the Supreme Court. The SEC previously fined Nvidia $5.5 million in 2022 for failing to disclose the impact of crypto mining on its business.
Experts suggest this ruling signals that courts will scrutinize companies that attempt to shield risk by reporting revenue at a segment level when the underlying drivers carry different risk profiles. The case is now moving toward trial, and a case conference is scheduled for April 21st to outline the next steps.
(Source：Decrypt)