TECH NEWS – The company, which has been on a tear lately, is asking for the case to be thrown out because it believes it did not present sufficient and/or appropriate evidence.

The US Supreme Court just heard Nvidia’s appeal of a lower court’s decision to allow a class action lawsuit from 2018 to proceed. Reuters reported on this. The lawsuit alleges that Nvidia misled investors by downplaying how much of its sales and revenue depended on cryptocurrencies, in violation of the Securities Exchange Act of 1934. We’ve already seen Nvidia pay for failing to disclose this crypto dependency, as in 2022 the company settled with the Securities and Exchange Commission for $5.5 million for failing to adequately disclose the extent to which crypto mining was responsible for its GPU sales and revenues.

At the time, that was big enough for scalpers to buy up GeForce RTX 3000 graphics cards, which Nvidia had already released Lite Hash Rate (LHR) versions of. The 2018 lawsuit that has now resurfaced, however, has nothing to do with that. In fact, it has a rather tumultuous history of its own, having been dismissed in early 2021, only to be revived by an appeals court. Now Nvidia is trying to kill it again, claiming it doesn’t meet the requirements.

The Supreme Court is currently debating whether this 2018 lawsuit is strong enough to be brought under the rules outlined in the Private Securities Litigation Reform Act of 1995, a law that attempts to prevent frivolous lawsuits. According to Reuters, in response to Nvidia’s argument, liberal Judge Ketanji Brown Jackson said, “I guess my concern is that you seem to be requiring plaintiffs to actually have evidence to make their case,” when such evidence is often provided at a later stage.

Nvidia may argue that plaintiffs need more evidence to have their case heard by the courts at all. Plaintiffs, on the other hand, may argue that proof of the claims in the lawsuit is provided after the lawsuit has been accepted for consideration. Where the line should be drawn between these two positions (where the threshold for considering a lawsuit should be) is for the Supreme Court to consider.

According to Reuters, the lawsuit is one of two cases the Supreme Court will hear this month that could lead to rulings that make it harder for private litigants to hold companies accountable for alleged securities fraud. The other is that of a major tech company, Meta. If Nvidia wins the appeal, it could set a precedent for what the threshold of proof should be for a class action against a large company to even be considered.

So Nvidia may not have misled investors on crypto.

Source:  PCGamer, Reuters