Supreme Court Clears the Way for Class-Action Lawsuit Against Nvidia Over Crypto Revenue Allegations
Nvidia Crypto Lawsuit Moves Forward as Supreme Court Rejects Appeal
The Supreme Court has declined to hear Nvidia’s appeal, allowing a class-action lawsuit accusing the company of misleading investors about its cryptocurrency mining reliance to proceed in lower courts.
Supreme Court Upholds Lower Court Decision
On Wednesday, the Supreme Court rejected Nvidia’s bid to block a 2018 investor lawsuit. The case alleges Nvidia downplayed the extent to which its revenue depended on cryptocurrency mining, leading to a significant stock price drop when the crypto market declined.
Following a sharp fall in cryptocurrency profitability, Nvidia’s stock plummeted by 28%, causing substantial financial setbacks.
While initially dismissed by a district court, the lawsuit was revived by the 9th Circuit Court of Appeals, which ruled that it met the criteria to move forward.
Nvidia’s Defense and Supreme Court’s Stance
Nvidia argued that the lawsuit did not comply with the standards of the Private Securities Litigation Reform Act of 1995, which seeks to curb frivolous lawsuits. Despite this, the Supreme Court upheld the appellate court’s decision, allowing the lawsuit to proceed without offering any explanation for its dismissal of Nvidia’s appeal.
This decision marks a significant step in the ongoing legal battle, potentially impacting Nvidia’s operations and its approach to disclosures on crypto-related revenues.
