In summary
- The Supreme Court dismissed Nvidia’s motion to dismiss a class-action lawsuit related to underreporting sales of GPUs for crypto Mining.
- The lawsuit alleges that Nvidia concealed more than $1 billion in mining-related sales and that its CEO minimized their impact.
- Nvidia remains focused on AI, posting record revenue, while facing criticism over the social value of cryptocurrencies.
The U.S. Supreme Court has dismissed CPU giant Nvidia’s motion to dismiss an investor-led class action lawsuit based on alleged understatement of GPU sales related to Cryptocurrency mining.
The Court dismissed Nvidia’s motion without explanation in a Dec. 11 ruling. The decision means the lawsuit will continue to move forward, although it was initially dismissed by a California district court in March 2021.
“We would have preferred a decision on the merits upholding the trial court’s dismissal of the case, but we are fully prepared to continue our defense,” an Nvidia spokesperson told Decrypt. “Consistent and predictable standards in securities litigation are essential to protecting shareholders and ensuring a strong economy, and we remain committed to supporting them.”
The ruling follows statements by U.S. Attorney General Elizabeth Prelogar and Securities and Exchange Commission Senior Counsel Theodore Weiman, who indicated that the Supreme Court should allow the lawsuit to proceed. . The comments were included in an amicus brief from the Department of Justice and the SEC intended to support the investors’ claims.
“The ruling of the appeals court should be affirmed,” the document concluded.
The lawsuit was initially filed in 2018 by a group of Nvidia shareholders who alleged that the company concealed more than $1 billion in GPU sales to cryptocurrency miners and that the company’s CEO minimized the volume of sales related to mining. cryptocurrencies.
In the first quarter of 2021, Nvidia generated $155 million in sales related to cryptocurrency mining alone. That year, the company launched a line of dedicated CMP cards to serve the crypto ecosystem mining market and tried unsuccessfully to reduce the mining performance of other new cards.
Despite the company’s large gains in the crypto ecosystem, the firm’s chief technology officer, Michael Kagan, said at the end of March 2023 that cryptocurrencies do not “contribute anything useful to society.”
The comments came as the GPU maker invested heavily in developing products specifically aimed at developing artificial intelligence (AI) rather than cryptocurrency mining. Reports from November indicate that Nvidia has seen record revenue and profits in the third quarter of fiscal 2025, mainly driven by the firm’s dominance in the AI and accelerated computing space.
Edited by Stacy Elliott.
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