Of the many stories shaping the business world in the wake of widespread availability of artificial intelligence products, the meteoric rise of chip maker Nvidia is one of them.
The California-based company became the most valuable public traded company on Tuesday, displacing Microsoft. The company’s rise can be attributed to the explosive growth in demand for chips used in artificial intelligence applications. The stock was worth $1,200 prior to a June 7 10-1 stock split.
The company owns about 80% of the market for AI chips, and demand (as well as NVidia’s stock price) shows no signs of slowing down. As investors and the tech industry speculate, litigation analytics can show us what kinds of lawsuits NVidia has faced, and what kinds it might in the future.
Over the last ten years, the company has faced 136 lawsuits in federal court. A spike of cases in 2015 represents a class action alleging that NVidia’s GTX 970 graphics card misled customers, because it was marketed with allegedly misleading tech specifications. The cases settled in 2016.
Like many tech companies, the top case type involving NVidia is patent. Other case types include fraud (representing the aforementioned class action), Securities and Exchange, and antitrust. Some securities cases filed in and around 2019, are shareholder complaints around the relationship between NVidia’s products and the cryptocurrency industry. NVidia’s graphics processing units are primarily designed for gaming and animation, but are also effective for mining (or generating) cryptocurrency. In recent years, as the crypto industry has fluctated, the supply and demand of NVidia’s cards has also fluctuated. However, no securities or shareholder lawsuits have been filed against the company since 2019, in line with the company’s recent success and stock market performance.
In federal court, NVidia has been represented by a wide variety of law firms over the years, including Orrick, Herrington & Sutcliffe, Cooley, Fish & Richardson, DLA Piper, and Winston & Strawn.
Notably, NVidia has not faced that much antitrust scrutiny in its 21 year history, despite having a dominant share of the graphics card market. However, that could change in coming months and years. The Department of Justice and the Federal Trade Commission, which both have the power to enforce antitrust laws, recently agreed on a plan to investigate the burgeoning AI field. The DOJ will investigate NVidia, while the FTC will investigate OpenAI and Microsoft.
