Graphics giant Nvidia has been hit with a new lawsuit, following hardware problems earlier this year. The lawsuit alleges that the company breached US securities laws by concealing the existence of a serious thermal defect in its graphics-chip line for at least eight months, “in a series of false and misleading statements made to the investing public.”
The suit should come as no surprise if you have been following the Nvidia bad chips fiasco. The company publicly acknowledged a flaw back in July, when it announced plans to take a one-time charge of up to $200 million to cover warranty costs related to an overheating problem, but stopped short of revealing exactly what product lines were affected – and even downplayed the impact of the issue.
The late announcement caused Nvidia’s stock price tumbled by over 30% to $12.98 and reduced the company’s market capitalization by $3 billion. The lawsuit seeks class action status on behalf of those people who bought or owned stock during the relevant period.