US Supreme Court To Hear Nvidia's Appeal Of Shareholder Crypto Suit

Zinger Key Points
  • The U.S. Supreme Court will hear Nvidia's appeal of a court ruling that accuses the company of committing securities fraud.
  • Nvidia will get the chance to present its case in the Supreme Court's next term, which starts in October.

The U.S. Supreme Court on Monday agreed to listen to NVIDIA Corp’s NVDA appeal of a lower-court ruling that claims the AI chipmaker misled investors about its cryptocurrency exposure.

What To Know: Nvidia will get a chance to argue its side of a court ruling that accuses the company of committing securities fraud after Supreme Court justices took up the chipmaker’s appeal on Monday, per Reuters.

Before Nvidia’s chips became the gold standard for the AI race, the company’s chips were highly sought after for use in cryptocurrency mining.

In 2018, a lawsuit was brought against Nvidia accusing the company and its top executives of violating the Securities Exchange Act of 1934 by misleading investors on how much of its revenue growth was being driven by demand for its crypto-related products.

A U.S. District Judge dismissed the suit in 2021 before it was revisited and brought back to life by the 9th U.S. Circuit Court of Appeals in San Francisco after the court reportedly found that CEO Jensen Huang made “false or misleading statements and did so knowingly or recklessly.”

Nvidia immediately appealed, arguing that the ruling created an opportunity for “abusive and speculative litigation.” The chipmaker also reportedly agreed to pay $5.5 million in 2022 to settle charges that it did not properly disclose the extent to which its business was impacted by cryptocurrency mining.

The Supreme Court is now set to hear Nvidia’s argument in its next term, which starts in October.

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NVDA Price Action: Nvidia shares are up approximately 167% year-to-date. The stock was up 0.33% at $132.31 at the time of publication Monday, according to Benzinga Pro.

Photo: Shutterstock.

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Posted In: CryptocurrencyNewsLegalTop StoriesTechAIartificial intelligenceJensen Huangplus semiconductorsReutersStories That MatterU.S. Supreme Court
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