The ongoing legal dispute between Nvidia and a group of investors has attracted attention from federal agencies as the case ascends to the U.S. Supreme Court. The investors claim that Nvidia misrepresented its sales to cryptocurrency miners, which they allege amounted to over $1 billion. The investors assert that Nvidia ’s CEO downplayed the significant sales figures linked to the crypto sector, leading to inflated expectations concerning the company’s financial health.
In an amicus brief filed on October 2, representatives from the U.S. Justice Department and the Securities and Exchange Commission expressed their support for the investors, arguing that the case contains enough substantive details to warrant further examination by an appellate court. The agencies emphasized their vested interest in the lawsuit, as it touches upon regulations aimed at preventing frivolous securities-related claims. They highlighted the importance of private actions in maintaining the integrity of the financial system.
The initial lawsuit was dismissed in 2018, but after a successful appeal, the Ninth Circuit court reinstated the case last August. Nvidia subsequently sought intervention from the Supreme Court to overturn this reinstatement. The chipmaker contends that the claims made by the investors are based on misleading expert testimony, but the federal agencies counter that the evidence presented supports the investors’ position.
Additionally, a cohort of twelve former SEC officials has filed a separate amicus brief supporting the investors, stressing that collective legal actions are crucial to ensuring accountability within U.S. capital markets. They criticized Nvidia ’s position, warning that new requirements for plaintiffs could hinder fair access to the legal process. The recent filings have sparked further support for the investor group, with several organizations, including academic experts and institutional investors, contributing additional amicus briefs to reinforce their stance.
