Nvidia must face an investor lawsuit claiming it misled shareholders about the impact of the cryptocurrency market on its sales after the Supreme Court dismissed the company’s appeal.
The court said it had “improvidently granted” Nvidia’s petition, meaning it decided it shouldn’t have taken it up in the first place. That means the case will have to continue on in the lower courts. During oral arguments last month, some justices seemed skeptical about whether it was appropriate for them to weigh in on the case, wondering if it was more of a dispute over facts than a legal question, according to Reuters.
The case stems from a pair of 2018 investor lawsuits claiming Nvidia recklessly misled investors about how closely tied its revenue growth was to cryptocurrency performance. Investors alleged that Nvidia and its top executives made materially false claims downplaying the impact of the volatile cryptocurrency market on its revenue growth, and exaggerating its ability to adapt its changes. An appeals court had allowed at least a portion of the consolidated case to move forward.
In a separate case in 2022, Nvidia settled charges with the Securities and Exchange Commission for $5.5 million over claims it obscured how its success was linked to the volatile cryptocurrency market. The company did not admit to any wrongdoing in the settlement.
Nvidia is facing increased legal scrutiny alongside its business success. The company is reportedly facing antitrust investigations from both Chinese authorities and the US Department of Justice.
“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,” Nvidia spokesperson John Rizzo says in a statement. “Consistent and predictable standards in securities litigation are essential to protecting shareholders and ensuring a strong economy, and we remain committed to supporting them.”