Nvidia, CEO Huang sued over disclosures related to suspected Chinese spy
NVDA•Nvidia and CEO Jensen Huang were sued in a proposed shareholder class action alleging they concealed Huang’s alleged relationship with Alice Huang and related national security concerns. Nvidia shares fell 4.3% Monday, reducing its market capitalization by approximately $190 billion.
1. Lawsuit alleges concealment
The complaint, filed in federal court in San Jose, California, accuses Nvidia and Huang of misleading shareholders about Huang’s alleged affair with Alice Huang, a former Megaspeed executive who is not related to him. It says the matter raised national security concerns that threatened Nvidia’s reputation and business prospects. The New York Times reported last month that U.S. authorities had concluded Alice Huang was a Chinese intelligence asset.
2. Probe and share decline
Nvidia announced a probe into the matter on Sunday. Huang told Nvidia employees he had been unfaithful to his wife but did not disclose details of the alleged relationship. Nvidia shares closed down 4.3% Monday, reducing the company’s market capitalization by approximately $190 billion. Shareholders led by Mark Kistenmacher are seeking unspecified damages.
