Back in August 2010, Nvidia Corp. finally agreed to settle a consumer class action brought by Hewlett-Packard Co., Dell and Apple Inc. laptop customers whose devices had been fitted with defective chips. But until this week, the chip maker’s lawyers at Orrick, Herrington & Sutcliffe were still busily facing down parallel class action securities fraud claims by investors whose shares allegedly tanked because Nvidia failed to disclose the extent of the chip glitches earlier. Now the shareholder class action is history as well, thanks to a ruling Wednesday by San Francisco U.S. District Judge Richard Seeborg dismissing the case without leave to amend.
The lead plaintiffs in the securities case, represented by co-lead counsel at Kahn Swick & Foti and Milberg, alleged in their December 2010 second consolidated amended complaint that Nvidia and CEO Jen-Hsun Huang knew that the defective chips were causing huge problems but failed to come clean with investors until the issue had been simmering for close to a year. They asserted claims on behalf of all investors who bought Nvidia stock between November 2007 and July 2008, claiming their shares suffered a 31 percent drop as soon as Nvidia finally disclosed the problems and that the alleged fraud resulted in a net charge of close to half a billion dollars.
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