NVIDIA sued by shareholders over GPU failures
Subject: Graphics Cards | September 12, 2008 - 03:00 PM | Ryan Shrout
I saw this post over at Tech Report that discusses a new lawsuit filed against NVIDIA due to the GPU failures that have been plaguing the company for months. The basis of the suit lies in the fact that NVIDIA knew about the potential problems as early as August 2007 yet hid that fact from the public for as long as 8 months. Considering the stock has gone from around $18 to the today's price of $10.16 its easy to see why those involved with the company would be pissed.
Just over two months after Nvidia went public with notebook GPU failures and subsequently lowered its revenue forecast, an angry shareholder has filed a class-action lawsuit in a California court. The suit alleges that Nvidia knew about the failures last summer but kept things under lid for eight months.
The plaintiff's law firm conveniently hosts a PDF copy of the complaint, giving us a glimpse into the allegations. Here's the meaty part:
At least as early as November 2007, Nvidia and the other Defendants have known about these unprecedented failure rates, as well as their "root causes." Indeed, Michael Hara, the Company's Vice President for Investor Relations and Communications, conceded during a September 4, 2008, "Citigroup Technology Conference" that Nvidia began troubleshooting these problems with major computer manufacturers beginning in August of 2007. . . . Despite this, for eight months or more Nvidia and the other Defendants concealed the defects and their ramifications for the Company's financial health and future in a series of false and misleading statements made to the investing public.