The advocacy group, The Digital Chamber (TDC) has warned that the U.S. Supreme Court’s decision to allow a revived lawsuit against Nvidia could invite grave trouble for the crypto world.
2018 Nvidia Lawsuit Could Trouble Crypto
The suit revived from 2018, accuses Nvidia of misleading investors about its GPU sales to crypto miners. The complaint claims that Nvidia issued deliberately misleading statements that understated more than $1 billion in GPU sales relating to crypto miners during 2017 and 2018. Nvidia was hit with a string of lawsuits from investors after its stock price crashed nearly 30% after announcing that revenues would fall 7% during late 2018.
Impact To Be Felt By Cutting-edge Companies
TDC claims that the class suit against Nvidia used an expert opinion that relied on “unsupported assumptions and inferences” about the crypto industry and Nvidia’s sales. It stated that “The impact will be felt the greatest by the most cutting-edge companies, like many in the cryptocurrency industry.” Notably, TDC’s members include industry crypto giants such as Crypto.com, Ripple and Binance.
TDC in its facts noted that the Private Securities Litigation Reform Act of 1995 (PSLRA) was passed by Congress to curb the surge of frivolous lawsuits, offering protection to growing tech companies by imposing stricter requirements on private plaintiffs pursuing securities class actions.
Why It Matters?
TDC in its blog shared that ‘it felt compelled to weigh in due to the grave risks of more frivolous securities lawsuits based on nothing more than unfounded negative perceptions about the cryptocurrency industry and its high-growth business cycle.’
It emphasized that “A win for the plaintiffs could open the floodgates to frivolous lawsuits against crypto companies, stifling innovation and investment. It would undermine the very protections designed by the PSLRA to safeguard emerging tech industries from costly, speculative litigation.”
