10/11/2026
Share:
10/11/2026
Share:
Nvidia becomes the first $5 trillion company, surpassing $4 trillion just three months ago.
SAN FRANCISCO, Nov 10: US chipmaker Nvidia and its Chief Executive Officer Jensen Huang are facing a proposed shareholder class-action lawsuit accusing them of misleading investors over Huang’s alleged relationship with a former executive of Singapore-based Megaspeed International who has been linked in media reports to suspected Chinese intelligence activities.
The lawsuit, filed Monday in the US District Court for the Northern District of California, alleges violations of the Securities Exchange Act of 1934, claiming that Nvidia and Huang failed to disclose information that could have significant implications for the company's reputation, business prospects and investor confidence.
The complaint was filed by shareholder Mark Kistenmacher, represented by The Rosen Law Firm. It seeks to represent investors who purchased or acquired Nvidia securities between October 9, 2025, and November 8, 2026.
According to the filing, Nvidia's previous statements that an internal review had found no evidence of its chips being diverted to unauthorized destinations, along with Huang's description of the company's business dealings with Megaspeed as "normal," were allegedly misleading.
The plaintiff claims these statements failed to disclose Huang's alleged personal relationship with Alice Huang, a former Megaspeed executive who has been suspected in media reports of gathering intelligence on behalf of China.
The lawsuit further alleges that the omission of information concerning potential national security concerns artificially inflated Nvidia's share price during the proposed class-action period.
The plaintiff is seeking unspecified compensatory damages on behalf of affected investors.
Following the lawsuit, Nvidia's board is also facing pressure to address questions surrounding its relationship with Megaspeed and the possible national security implications.
Nvidia board launches independent investigation
The lawsuit comes after Nvidia's board of directors announced Sunday that it had launched an independent investigation following reports that Huang had been targeted by a foreign intelligence operation.
A committee of independent directors, assisted by outside legal counsel, will oversee the inquiry.
The board said Huang supported the investigation and had committed to cooperating fully. It also expressed confidence in his leadership and said it currently had no reason to believe that US national security or Nvidia's confidential information had been compromised.
The investigation will examine all available information, with the board promising further updates as appropriate.
China rejects espionage allegations
China has rejected the allegations, describing claims that Alice Huang was working for Chinese intelligence as baseless and an attempt to smear the country.
Foreign Ministry spokesperson Guo Jiakun said Monday that the so-called Chinese spy allegations were unsubstantiated.
The controversy has attracted international attention because Nvidia is a leading supplier of advanced processors used to develop and operate artificial intelligence systems. Its technology is central to the global AI industry, while exports of advanced chips to China remain a major issue in US-China relations.
The proposed class action seeks unspecified damages. The allegations in the complaint have not been established in court, and the proposed investor class has not yet been certified.
Nvidia shares fall 4.27%Nvidia shares fell 4.27% on Monday to close at $178.67, following the emergence of the allegations. The decline wiped approximately $190 billion off the company's market value, according to reports.
The shareholder complaint argues that investors suffered losses because the company allegedly failed to disclose material information that could have affected its stock price
