The Digital Chamber warns that a Supreme Court ruling against Nvidia could lead to a surge in baseless lawsuits, threatening innovation and growth in the cryptocurrency sector.
The Digital Chamber, a prominent crypto advocacy organization, has expressed its support for Nvidia in a high-stakes legal battle before the U.S. Supreme Court. The case centers around allegations from a group of investors who claim that Nvidia misrepresented the extent of its GPU sales to cryptocurrency miners, potentially misleading the market.
The chamber warns that if the Supreme Court allows the class action lawsuit against Nvidia to proceed, it could set a troubling precedent, opening the floodgates for a surge of “frivolous securities lawsuits” across the cryptocurrency industry.
In an amicus brief filed on August 20, The Digital Chamber, formerly known as The Chamber of Digital Commerce, urged the Supreme Court to overturn a previous appellate court decision that had revived the lawsuit. The original suit, filed in 2018, accused Nvidia of concealing over $1 billion in GPU sales to crypto miners and downplaying the significance of these sales publicly. This, the plaintiffs argue, led to significant losses when the crypto market and Nvidia’s financial performance declined simultaneously.
The Digital Chamber’s CEO, Perianne Boring, emphasized the potential dangers of this lawsuit, arguing that it could encourage similar unfounded claims, particularly against companies at the forefront of emerging technologies like blockchain and cryptocurrency. The brief criticized the expert testimony used in the case, calling it based on “unsupported assumptions and inferences” rather than concrete evidence.
The chamber further contended that the lawsuit does not meet the stringent requirements of the Private Securities Litigation Reform Act of 1995 (PSLRA), which mandates that lawsuits clearly identify each allegedly misleading statement and provide factual support for their claims.
“If this case succeeds, it could pave the way for speculative claims to thrive in court, creating a hostile environment for innovation within the crypto industry,” warned the chamber. Such a scenario, they argue, would stifle technological advancement by burdening companies with expensive litigation and deterring investment.
The outcome of this case could have far-reaching implications for the cryptocurrency industry, potentially hindering the growth of blockchain technology and undermining the protective measures established by the PSLRA for emerging industries.
