The U.S. Supreme Court is allowing an investor-led class-action lawsuit that accuses tech giant NVIDIA of misleading its investors. The Swedish inventors pursuing the case say they were misled about sales of the computer chips as they relate to volatile cryptocurrency mining demand.

The Supreme Court's decision stems from the 2018 class action lawsuit that was filed by a Swedish management firm. The plaintiffs filed their lawsuit after NVIDIA saw a staggering 28% drop in its stock price after indications of profitability from cryptocurrency sales came to light.

The computer chips, which are essential in gaming computer systems, have also seen a demand among users and organizations who rely on these high-powered chips to be used in systems that mine digital coins like Bitcoin, Ethereum, and others.

The Swedish investors argued that NVIDIA did not disclose over $1 billion in chip sales related to cryptocurrency mining. Instead, they say the company falsely attributed its surging revenue to its gaming division.

In doing so, the investors argued that the company's stock price was artificially inflated resulting in a significant drop in the stock price after the company came up short in its projected revenue.

The court's decision to let the class action lawsuit move forward came during the same week that China said it would be investigating NVIDIA over suspicions that it violated Chinese anti-monopoly laws.

In disputing the lawsuit, attorneys representing NVIDIA argued that the lawsuit should be thrown out because it did not rise to the standard of the 1995 Private Securities Litigation Reform Act. This act helps protect organizations from frivolous lawsuits.

Attorneys for the investors, however, argue that the lawsuit is essential in helping maintain the integrity of the markets. Deepak Gupta, an attorney representing the investors in the Supreme Court, explained, “This is a win for corporate accountability. When corporations mislead shareholders, they undermine trust in our markets. Ensuring that investors can seek justice is essential to preserving fairness and transparency.”

The Supreme Court's decision dismissed NVIDIA's appeal to have the case thrown out. The justices did not provide an explanation for their decision. The Supreme Court’s ruling will uphold a Ninth Circuit appellate court decision that revived the lawsuit after a lower court dismissed the case in 2021.

Officials for the tech giant have disputed any wrongdoing, and a spokesman for the company shared that they are “completely ready to keep defending ourselves.”

These new legal challenges come just two years after NVIDIA settled with the SEC for $5.5 million. The settlement came after allegations that NVIDIA was not adequately disclosing how its crypto mining division was affecting its gaming operations. NVIDIA settled without acknowledgment or denial of the SEC accusations.

Despite the company’s legal challenges, the company stock price continues to soar. In 2024, NVIDIA gained over 180%, leading it to become a major tech company on the stock market.

As the case is set to continue, the outcome could spell out how tech giants like NVIDIA are required to divulge their involvement in particularly volatile industries such as cryptocurrency.