Nvidia faces a class-action lawsuit over $1 billion in crypto mining sales after the U.S. Supreme Court rejected their appeal on December 11. The suit started in 2018 when investors claimed Nvidia hid substantial GPU sales to cryptocurrency miners. They say the company downplayed crypto mining during intense crypto market volatility.
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Exploring the $1B Nvidia Lawsuit and Crypto Mining Market Risks
Source: Nvidia Newsroom
Supreme Court’s Decisive Ruling
Source: The Motley Fool
The Supreme Court dismissed Nvidia’s attempt to overturn the Ninth Circuit appeals court’s decision. The lawsuit over $1 billion stems from claims that the company hid GPU sales to crypto miners. This led to a 30% share price drop when sales crashed alongside the falling crypto market in late 2018.
Department of Justice Backing
The Justice Department and SEC support the investors in the Nvidia crypto mining lawsuit. Evidence from former executives and a Bank of Canada report shows Nvidia understated crypto revenue by $1.35 billion. “We would have preferred a decision on the merits affirming the trial court’s dismissal of the case, but we are fully prepared to continue our defense,” stated an Nvidia spokesperson.
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Legal Implications and Market Impact
The revived lawsuit raises concerns about how companies report their crypto-mining activities. Justice Sonia Sotomayer called Nvidia’s petition “concerning” at the Supreme Court hearing. This highlights broader questions about market transparency amid ongoing crypto market volatility.
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Future Proceedings and Broader Context
The case returns to the 9th Circuit Court as Nvidia, now the world’s largest company battles multiple legal challenges. This development in the Nvidia crypto mining sales case comes alongside a Chinese antitrust probe that could bring more billion-dollar penalties. The lawsuit shows growing scrutiny of how companies disclose their cryptocurrency operations and impacts on regular business.
