Shareholder lawsuit against NVIDIA: Huang is the target

The NVIDIA shareholder lawsuit was the first court step in the growing crisis around CEO Jensen Huang's relationship. The case centers on allegations that Huang hid from investors his relationship with a woman accused of spying for China. Moreover, the company's market value is on track to lose more than $470 billion in two days.

Who filed the NVIDIA shareholder lawsuit, what does they want?

Mark Kistenmacher filed the complaint. It accuses NVIDIA and Huang of misleading investors about the nature of the CEO's relationship. As such, the lawsuit seeks class-action status for anyone who purchased NVIDIA stock between October 9th and November 8th.

The woman in question is Alice Huang, the former executive of Taiwanese company Megaspeed. He is suspected of being an intelligence asset for China. Huang is a very common surname; The two are not related.

Why are dates important?

The case draws the period it defines according to two events. The first one is October 9th. That day, The New York Times published a news story about the connection between NVIDIA and Megaspeed. NVIDIA responded to this connection as a normal business relationship.

The second date is November 8. Jensen Huang admitted to having an affair. The company also announced that it had launched its own investigation to investigate whether its CEO was the target of a foreign intelligence operation.

Rizzo's statement is in the lawsuit petition

Between the two dates, on October 29, the New York Times published a more comprehensive article. The article claimed that Huang was the subject of a suspicious Chinese intelligence operation. NVIDIA representative John Rizzo said in the article: "Jensen's contacts with Ms. Huang are not unusual or unexpected. Meeting with customers is part of the job of CEO; Jensen speaks with thousands of customer executives each year."

However, the NVIDIA shareholder lawsuit petition argues that this explanation is inaccurate.

decline in shares

NVIDIA shares fell sharply following the allegations. The company is on course to lose more than $470 billion in market value in the last two days. The petition states: "As a result of defendants' wrongful acts and negligence and the sudden decline in the market value of the company's securities, plaintiff and other class members have suffered significant losses and damages."

It is not yet clear whether the court will consider the NVIDIA shareholder lawsuit as a class action. In addition, the internal investigation initiated by NVIDIA against its CEO continues.