Nvidia shareholders have filed a class-action lawsuit against the AI chip giant and CEO Jensen Huang, accusing them of hiding what investors should have been told about Huang’s relationship with a woman accused of being a Chinese spy.
CBS News reports that the suit was filed in federal court in San Jose, California. It centers onreports that Jensen Huang, who was born in Taiwan, developed a close relationship with Alice Huang, a Chinese executive tied to Megaspeed, a Singapore-based data center company that buys AI chips from Nvidia.
Breitbart News previously reported that Nvidia denied an improper relationship before Huang eventually admitted it on Sunday:
Nvidia, meanwhile, said Megaspeed is an ordinary regional customer and that Jensen Huang’s meetings with Alice Huang are routine CEO interactions with customers.
“Jensen’s interactions with Ms. Huang are not unusual or unexpected. Meetings with customers are part of a C.E.O.’s job; Jensen talks with thousands of customer executives every year,” Nvidia spokesman John Rizzo told the Times.
Rizzo added that Nvidia is “confident that if the U.S. government believes that any person is a threat to American industry, it would let us know,” and that customers like Megaspeed “receive ordinary business information — not sensitive Nvidia trade secrets — and zero information relevant to national security.”
The law firm of Schall, Brown & Schwartz was the first to launch an investigation of Nvidia over the Chinese spy scandal. The class-action lawsuit was then filed by the Rosen Law Firm.
The lawsuit claims Huang and Nvidia misled shareholders about the national security concerns the relationship raised, and that the omission artificially propped up Nvidia’s share price. “As a result of Defendants’ wrongful acts and omissions, and the precipitous decline in the market value of the Company’s securities, Plaintiff and other Class members have suffered significant losses and damages,” the complaint states.
Nvidia has said it launched an independent investigation into Huang. The company’s board opened its inquiry after reports described Huang as “the target of a foreign intelligence effort,” and Nvidia shares fell in the aftermath. Beijing has denied the allegation.
Two law enforcement sources told CBS News on Monday that the Justice Department’s National Security Division is investigating Megaspeed over potential violations of U.S. export restrictions on advanced AI chips. Washington limits the export to China of most cutting-edge silicon chips as the two countries compete for dominance in technology.
Nvidia is a global leader in producing the chips that power AI models and ranks among the world’s most valuable companies. Huang has become a central figure in the AI boom, and he serves as a close informal adviser to President Trump, who has repeatedly opposed regulating the AI industry out of concern that doing so would let China gain the upper hand.
On Sunday, Huang sent a message to Nvidia employees admitting he had been “unfaithful” to his wife. “My actions hurt her and our children. There is no excuse for what I did. I am deeply sorry,” he wrote.
Read more at CBS News here.
Lucas Nolan is a reporter for Breitbart News covering issues of AI, free speech, and online censorship.
