Investors suing chip maker giant Nvidia for lying about the size of the company's revenue related to cryptocurrency mining have brought a new charge against Nvidia which, they say, is seeking to eliminate key evidence. disclosed by a former employee.
New shadows for society
The shareholder group recently said Nvidia's attorneys induced the former employee, known by the pseudonym "FE 5," to "disavow" several key statements and are now pushing for the entire testimony to be rejected by the court.
The lawsuit began in December 2018, and the prosecution alleged that Nvidia downplayed the amount of graphics cards, most notably GeForce GPUs, which it was selling to cryptocurrency mining operators to support the share price.
Nvidia denied the allegations, saying the plaintiffs had "carefully selected" the data to build the case. FE 5, last May, provided evidence of a modified document that appeared to show that the chip maker's executive team, including founder and CEO Jensen Huang, was regularly updated with data on the amount of GeForce GPUs purchased by crypto miners. .
FE 5 was Nvidia's head of consumer marketing in South Asia for five years until 2019. Nvidia's lawyers informed plaintiffs in June that they had identified and contacted FE 5, which responded by saying it had run into a misunderstanding. so he thought his report was useful for semiconductor research and not as evidence for a lawsuit against the company.
The plaintiffs' attorneys argue that FE 5 is now providing these alleged misrepresentations for fear that Nvidia may take revenge on it. They have now asked the court to quash Nvidia's motion to dismiss the evidence, motivating the request on the grounds that federal courts have often rejected defendants' attempts to discredit former employee testimony in the past.
Investor confidence tested
The lawsuit is not simply a budget error but an alleged lack of transparency that would have led investors to buy shares on the basis of false or inaccurate information.
A study commissioned by the plaintiffs to Prysm Group economists would show that Nvidia would have grossed at least $ 1,728 billion from sales to miners in the period to which the lawsuit refers, of which $ 1,1 billion was included in the Gaming sales balance sheet.
This created the perception that Nvidia was a much more prosperous company than it actually was, with most of the revenue coming from the burgeoning gaming industry, not the cryptocurrency mining industry, which could collapse at any moment. . Once again, Nvidia is testing investor confidence by casting a lot of shadows on the company's transparency policy. Here you can take a look at the value of Nvidia shares in real time.
