updated 04:50 pm EDT, Wed September 10, 2008
Nvidia sued over chips
A lawsuit filed against NVIDIA on Tuesday alleges the graphics card maker not only knew about a serious flaw that caused some of its graphics chips products to overheat but also kept it hidden from the public for at least eight months, says a Wednesday report. When the company did acknowledge issues with its products back in July, its shares fell by nearly a third and the company pledged to put away $200 million to cover warranty costs. The lawsuit, which seeks class action status, claims NVIDIA violated US securities laws by making false and misleading statements to the investing public.
While no specific dollar amounts for damages are yet disclosed by the lawsuit, which was filed by New York-based law firm Shalov, Stone, Bonner and Rocco in California, it could have disastrous effects on the company and its image. The lawyers point out to PC maker Hewlett-Packard issuing BIOS updates back in November of 2007 that would have a PC's fans working overtime to cool the graphics chips and extend their longevity as just one clue that points out NVIDIA's knowledge of the problem.
The problem is wide-ranging and doesn't seem to be restricted to one particular line of cards. Late last month, it was reported most of the company's GeForce 9-series cards were also affected in addition to the GeForce 8 range.
In addition, Dell recently confirmed that its own systems are also affected.