Shareholders filed a class-action lawsuit against Nvidia and its CEO, Jensen Huang, on Monday, Nov. 9, 2026, alleging they failed to disclose a relationship between Huang and a woman accused of being a Chinese intelligence asset. The complaint, filed in federal court in San Jose, California, claims that the failure to disclose the affair artificially inflated Nvidia's stock price and misled investors regarding potential national security risks.
The legal action follows reports from the New York Times that Huang had a close relationship with Alice Huang, an executive associated with Megaspeed, a Singapore-based data center company. While the two are not related, U.S. authorities reportedly concluded that Alice Huang was acting on behalf of Chinese intelligence. On Sunday, Nov. 8, Jensen Huang released a message to employees admitting he had been unfaithful to his wife and apologized to his family, though he did not identify the woman involved.
The lawsuit by the Rosen Law Firm coincided with a decline in Nvidia's market value. Shares of the chipmaker fell $7.97 per share, or approximately 4.3%, to close at $178.67 on Monday. The filing claims these losses resulted from "wrongful acts and omissions" by the defendants. Nvidia announced it launched an independent investigation into whether Huang was the target of a foreign intelligence effort, a claim that the Chinese Foreign Ministry has denied as "unsubstantiated."
President Donald Trump stated on Monday that the FBI is investigating the matter. Trump, who described Huang as a close informal adviser, told reporters he had spoken with the CEO, who claimed he was unaware the individual in question was a spy. Concurrently, law enforcement sources confirmed that the Justice Department's National Security Division is investigating Megaspeed for potential violations of U.S. export restrictions concerning advanced AI chips.
The situation follows pressure on U.S. export controls and national security protocols. The lawsuit alleges that Nvidia's investigation highlights the possibility that American export laws could be sidestepped. Such a finding could lead to stricter federal oversight for U.S. chip manufacturers and their international distributors.
What happens next: Nvidia's board is conducting an independent inquiry into the CEO's conduct and his potential as a target for foreign intelligence. The shareholder lawsuit will proceed in the U.S. District Court for the Northern District of California, where a judge will determine if the case meets the requirements for class-action status. Huang has stated he is cooperating fully with the inquiries. Investors will monitor subsequent quarterly filings to see if the company lists these legal and security matters as material risks to future business prospects.