Sued?

[g__day]

Antlers is saying something I have long wondered and asked here. If NVidia artifically raised their scores in the leading industry benchmark and then they claimed the worlds fastest GPU based on 3d marks - and if the public and shareholders believed them they have committed fraud for the purposes of undue financial gain. Too their OEM partners who plug their cards could readily be joined to an action if they ever said "the fastest system" instead of "NVidia says the fastest system".

Cause it could be argued they mis-represented their products or caused other independents to mis-represent their products by their own wilful actions - thus placing OEMs at risk of being sued too.

The damages part of the equation comes from both consequential loss - I can't do cinematic rendering hence I am deprived.

If this was a car that claimed to to 30% more miles per gallon - and it turned out they performed an action to fake the tests or make independent reviews get the wrong conclusions - you could could sue them. Basically its false advertising or its putting someone else at risk unknowningly to them to do your false advertising - hence damaging an independent reviewers reputation and possibly lively hood.

Hell - even ATi could sue them for damaging their sales by claiming they had a superior product - thus hurting ATi sales - when it turns out their product was inferior - or too complex to economically code for to make it superior.

I believe their is genuine mis-representation over the last year - so the damage has been done and is real - hence there is a time bomb ticking here for NVidia - PR and Marketing and Legal have to be real careful here - becuase its a powder keg - even if it has a slow fuse.

* * *

I guess as standards tighten up - and cheats become know - it becomes easier to say what improper actions / optmisations have occured and who has suffered losses because of it - if there share prices go down - because of this there may be a case to answer for - company directors aren't supposed to lie or mis-represent their product's abilities. In Australia if you did that you'd have breach Section 180 of the Corporations Act 2001 - I am sure the USA must have something like this act, especially since Enron...

 

[WaltC]

Actually (I remembered this when responding in another thread), I think Antlers has an excellent point with regard to one specific, undeniable thing nVidia did relative to it's marketing of nv30: it's misrepresentation of the "8 pixels per clock" specification for nV30.

I really think that anyone who bought nVidia stock after the Comdex '02 announcement of nV30 by nVidia, at which time the chip was specified as an 8-pixel-per-clock architecture, and up until the first nV30 prototype boards hit the review circuit and were seen as woefully non-competitive with shipping R300 products which were indeed 8-pixels-per-clock, might be considered a legitimate plaintiff in a class-action brought against nVidia. There was a period of several months between the Comdex announcement and the emergence of the first nV30 prototype boards for published reviews, and IIRC no one at any time during that period was given cause by nVidia to suspect that nV30 was other than 8 pixels per clock.

This may indeed have planted the false impression in the minds of investors during that period that nV30 would at least be competitive with R3x0, and as such might have influenced them to buy the stock. It seems to me they would have a legitimate and entirely defensible position, provided they could show they purchased nVidia stock during that period. As well, it's one of the misrepresentations of nV30 which can be clearly and unambiguously directly tied to nVidia, in an official capacity. It's eminently provable, in other words.

So, yes, I think you guys have made good points! In thinking about it, it's surprising to see that a wolf-pack of hungry lawyers hasn't jumped on this already--especially considering some of the extremely weak class-actions some of them are engaged in presently that have made the news in the last couple of months.

 

[nelg]

I agree with you g_day. IMHO nV has had a pattern of behavior that mislead people as to the real Dx9 performance of the nV3.X chips. I would assume that in itself is grounds for a class action suit.

 

[TheMightyPuck]

there is no legal ground for action - and trust me, I'm a 3rd year Law student, so I'm no newbie on law

Not even a newbie some would say

 

[TheMightyPuck]

Oh, by the way, any lawsuit by an end user would depend on the eula (which i suspect is pretty lawsuit unfriendly) and whether or not, and to how much, the courts in the jurisdiction you are in are going to enforce it. In any case, can you imagine what kind of can of worms you would open by allowing a cause of action based on Nvidia's "performance enhancements". I can think of no cause of action you could bring that wouldn't get your lawyer slapped with sanctions. Then again there are some pretty clever ambulance chasers out there so who knows.

 

[Sharkfood]

Anyone that cant see a cause of action nor see specific and documentable "damages" from recent practices really should go back to lawschool. There are literally hundreds of means to address and concoct such a suit.

I'd say the main reason no hungry lawyers have jumped at this opportunity is NVIDIA has a very large capital base and has a track record of putting substantial budget into their legal pursuits.

 

[kkevin666]

Must be the only industry where fraud and deception cant be sued for.

 

[TheMightyPuck]

Anyone that cant see a cause of action nor see specific and documentable "damages" from recent practices really should go back to lawschool. There are literally hundreds of means to address and concoct such a suit.

I'd say the main reason no hungry lawyers have jumped at this opportunity is NVIDIA has a very large capital base and has a track record of putting substantial budget into their legal pursuits.

Help me out here? What cause of action?

 

[Sharkfood]

Help me out here? What cause of action?

Really? You can't figure out the plethora of damages that can be litigated by having products sold based on falsified, intentionally fraudulent performance figures? Go fish.

Class action suits from consumers range from skewed real-world results for render farms to bad faith on delivery of price/value point, to productivity loss based on product choice versus competitors from fraud. I know, my company was on the losing end of one of these lawsuits 2 years ago... and it was because our performance was 20% greater than our competitors on a "normalized" set of data (we didn't even create the normalized data!) yet was substantially lesser performing on different data.

Non-class action/singular entity suits can be filed by any OEM or hardware manufacturer that has signed contracts on a chipset series that has had it's performance measured by these falsified tests. Either contract negotiation rates can be questioned or some form of pro-rating of contracted percentage based on sales can be litigated (or settled for promise of delivery of given numbers).

You guys seem to think there needs to be a written rule that IHV's or companies declare performance figures not interpolate into real-world performance or productivity. This isn't the case with bean counters and the legal system. If ANY form of fraud/misrepresentation can be proven (which in this case, it can), then civil litigation may commence with a high degree of success.

 

[WaltC]

...
You guys seem to think there needs to be a written rule that IHV's or companies declare performance figures not interpolate into real-world performance or productivity. This isn't the case with bean counters and the legal system. If ANY form of fraud/misrepresentation can be proven (which in this case, it can), then civil litigation may commence with a high degree of success.

The problem here though Shark is that it's never sufficient to show that a company has used inaccurate data to promote its products--that's often referred to as an "error" or "mistake" and simply does not constitute "fraud" from a legal definition. IE, "mistakes" are not actionable, nor are "opinions." Fraud, on the other hand, must be proven to be fraud--that is, you must be able to prove a premeditated intention to deceive. It's kind of like libel law--"errors" do not constitute libel, even if they result in false statements. To win a libel case you have to prove not only that the statement is false, but also that the statement was made with "malicious intent." If the bar wasn't so high then the courts would be clogged with "libel suits" at the expense of everything else.

In this case with nVidia, I think the "8-pixel-per-clock" thing relative to nV3x is certainly a clear-cut case of fraud as there's no conceivable way a company could misrepresent something so fundamental (in the same way an automobile manufacturer could not represent a 4-cylinder engine as an 8-cylinder engine) without doing it deliberately and with premeditation.

But the benchmark stuff? Apple's been doing it for decades and getting clean away with it... That kind of thing is much more difficult to prove legally than you might think. Really, that's an issue for the FTC, I think. People shouldn't hesitate to make complaints there if they see fit, as that's the agency specifically tasked with the "oversight" of advertising.

But the consumer who protects himself is far better protected than the consumer who "trusts" the government to protect him in the marketplace. The information is out there and readily available for all those who wish to see it. Sure, you can sue anyone for any reason. Wining, however, is a whole different ballgame (thankfully.)

If it's any consolation I don't really think nVidia is "getting away" with very much. They've paid a steep price already this year economically, and I don't see that improving for them until they change their fundamentals with respect to their marketing.