The U.S. Supreme Court has decided to hear a lawsuit appealed by NVIDIA this October. NVIDIA, a major beneficiary of the artificial intelligence (AI) boom, appealed a class-action lawsuit brought by shareholders.
On the 17, CNBC reported that the U.S. Supreme Court has accepted NVIDIA’s appeal against a class-action lawsuit filed by shareholders against NVIDIA’s CEO Jensen Huang, and NVIDIA.
This lawsuit was led by investment management company E. Öhman J:or Fonder AB, headquartered in Stockholm, Sweden. The lawsuit seeks financial damages from NVIDIA.
The investment management company filed a lawsuit against NVIDIA and the company’s senior executives, claiming that NVIDIA had violated securities trading laws by falsely disclosing that a significant portion of its revenue in 2017 and 2018 came from the purchase of cryptocurrency.
U.S. District Judge Haywood Gilliam Jr. dismissed this lawsuit in 2021. However, the 9th U.S. Circuit Court of Appeals, located in San Francisco, issued a decision allowing the lawsuit. The appellate court allowed the lawsuit, stating that Huang made intentionally misleading or potentially confusing statements.
NVIDIA immediately appealed to the Supreme Court, stating that the appellate court’s decision would encourage the abuse of speculative lawsuits. The Supreme Court is scheduled to hear NVIDIA’s lawsuit in October.
Previously, in 2022, NVIDIA agreed to pay $5.5 million to the U.S. Securities and Exchange Commission (SEC) on charges of not properly disclosing the impact of virtual asset mining on the gaming industry. At that time, NVIDIA neither admitted nor denied the allegations raised by the SEC, agreeing to pay $5.5 million.
Meanwhile, the Technology Sector SPDR Select Sector Fund (ticker symbol XLK), a representative exchange-traded fund (ETF) investing in S&P 500 technology companies in the U.S. stock market, has decided to increase its investment weight in NVIDIA from the previous 6% to 21% through regular asset rebalancing. This means purchasing more than $10 billion worth of Nvidia shares compared to the current amount.
