Reported ties between Jensen Huang, the CEO of AI powerhouse Nvidia, and a suspected Chinese spy have sparked an investigation by the FBI, calls for congressional hearings, a review by the company’s independent directors and a proposed investor class action lawsuit.
Below is a look at the potential legal exposure for Huang, Nvidia and the directors of the company, which dominates the global market for computer chips that power the AI economy.
The New York Times reported last month that Huang had a relationship with Alice Huang, an unrelated former executive of Singapore-based company Megaspeed, whom US authorities investigated and concluded was a Chinese intelligence asset. Megaspeed has faced US scrutiny over suspicions that it helped Beijing gain access to Nvidia’s advanced AI chips whose export to China is restricted.
On Sunday, Nvidia’s Huang admitted he was unfaithful to his wife without providing details about the relationship, which led to a drop in Nvidia’s stock price. Trump said Huang told him that he had no idea that the woman was a spy and Huang has not been accused of criminal wrongdoing.
Reuters could not independently verify the intelligence allegation, which China’s foreign ministry has said was “groundless,” nor has it verified Alice Huang’s current employment status with Megaspeed.
Nvidia has said its board has “no reason to believe” US national security or company secrets were affected, though an independent committee of directors will review all available information. The company said on Tuesday the independent directors hired the Wachtell, Lipton, Rosen & Katz law firm to assist with its investigation.
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