Nvidia and CEO Jensen Huang were sued in a proposed shareholder class action in federal court in San Jose, California, on Monday, five minutes after the stock closed down 4.27% at $178.67, a seven month low that erased $193 billion in market value. Seeking unspecified damages, the complaint alleges Nvidia and Huang defrauded investors by concealing his affair with former Megaspeed executive Alice Huang, whom US intelligence officials suspect was recruited by China’s Ministry of State Security, and the resulting national security risks. The suit cites an October 29 statement from an Nvidia spokesman calling their interactions “not unusual or unexpected” and Huang’s October 30 remark to Bloomberg regarding Megaspeed that “we’ve studied all their deployments of our GPUs and counted every one.”

Bloomberg reported Monday that Nvidia’s inventory figures relayed to the US government undercounted chips sold to Singapore-based Megaspeed through hardware partners by 50,000 units worth billions of dollars. In late summer 2025, Nvidia General Counsel Tim Teter also intervened in a Commerce Department chip smuggling investigation into Megaspeed, calling Under Secretary Jeffrey Kessler to ask if the Bureau of Industry and Security was involved in Singapore’s detention of Alice Huang before emailing investigators, which prompted officials to halt the probe and transfer it to the Justice Department, according to Bloomberg and the New York Times. Inside Nvidia, Teter insisted as recently as last week that claims of an affair were inaccurate.