Nvidia and its chief executive, Jensen Huang, have been accused of misleading shareholders in a lawsuit tied to a Chinese spying scandal involving the $4.3 trillion chipmaker. President Donald Trump said the FBI is investigating Huang’s affair with an alleged Chinese spy, an allegation that forms the backdrop of the new legal action.
The complaint, filed in federal court in California, claims that Nvidia and Huang misled investors about the executive’s alleged relationship with Alice Huang, a former executive of Singapore-based Megaspeed who is not related to him. The lawsuit asserts that neither the company nor its CEO disclosed that the matter raised national security concerns that threatened the chipmaker’s reputation and business prospects.
The alleged relationship was reported last month, and U.S. authorities had concluded that Alice Huang was a Chinese intelligence asset, the lawsuit notes. At the center of the dispute is a statement Nvidia provided about the CEO’s contacts with Alice Huang, in which the company described the interaction as “not unusual or unexpected.” Nvidia added that “meetings with customers are part of a CEO’s job; Jensen talks with thousands of customer executives every year.”
On Sunday, Huang acknowledged that he had been “unfaithful” to his wife, without identifying the person involved in the affair.
The lawsuit contends that Nvidia’s earlier characterization of the interaction was “materially false and misleading at the time it was made because Jensen Huang had an affair with Alice Huang.”
The claims arrive as Nvidia, one of the most valuable companies in the world, faces scrutiny over the conduct of its chief executive and over whether the company’s public statements adequately informed shareholders about risks connected to the relationship. The lawsuit does not treat the allegations as established fact, but argues that the failure to disclose them exposed investors to reputational and business risk.
Huang remains CEO of the company. Trump’s statement that the FBI is investigating the matter adds a federal law enforcement dimension to a dispute that has so far unfolded through news reporting, corporate statements and now litigation.