The alleged concealment unraveled in late 2018, according to the plaintiffs, when Nvidia reported a 7% drop in quarterly revenue, tied to a cryptocurrency market downturn. Following the announcement, Nvidia’s stock plummeted by 28.5% over two trading days.
Nvidia countered that the investors lacked concrete evidence that Huang had reviewed internal crypto-related sales documents. The company accused the plaintiffs of using an external expert’s report to sidestep the PSLRA’s strict pleading requirements.
The investors, however, pointed to testimony from two former employees who they said corroborated their claims. Nvidia dismissed the testimonies as insufficient, arguing they failed to identify specific documents reviewed by Huang.
Last year, the Ninth Circuit Court of Appeals allowed the case to proceed, prompting Nvidia to take its appeal to the Supreme Court. But during oral arguments, justices appeared to reconsider their decision to hear the case, questioning whether it involved broader PSLRA issues or merely sought correction of a specific ruling.
