Nvidia Gets Hit With Lawsuit for Chip Defects

[Lempira72]

Only In America !!

 

[kansur0]

Corporations will always try to get away with what they can...especially in the computer industry. When they become as large as nVidia there is a fair amount of pressure to remain competitive. Most products that are created can sometimes go through five or six revisions inside a product life cycle before they have perfected that specific line. When they test a design and it "works" they release it. What comes into play here is the product testing. How high are the testing standards? What is termed an acceptable flaw? What percentages of failure are they willing to accept before a product is deemed ready for market release?

Due to the nature of the failure it would seem that this problem would be hard to detect. Stress testing once or twice would not make the product fail. From what I have read the heating and cooling of the chip over many cycles causes the chip to fail. They might have even found the problem and took a gamble.

Option 1 - They could have fixed the problem using a different material but that would have entirely changed the design of the board because of the conductive properties of the material. This could have delayed lines of chips by two to three months thus losing ?hundreds? of millions in revenue releasing at a later date.

Option 2 - They release the chips maintaining market share and profits hoping that at a later date they could fix the problem by changing the material with a new design revision. They also hope that the percentages of failure turn out to be an "acceptable" level without having to do a full scale recall.

It would seem that they chose Option 2 and with this option comes scrutiny and downgrade in reputation as a company that is willing to sacrifice quality over profit and market share.

Long story short (too late) they are now going to pay. Was it worth it? In my opinion...NO. Any company that knowingly sells products that are faulty in exchange for profit should not be in business.

Now the onus is on them to prove by whatever means that they did not know about the defect. Now it is up to the courts to decide. Let's see what they can dig up!

 

[piratepast40]

[citation][nom]V3NOM[/nom]typical.[/citation]
I don't get it. Typical what?

 

[Spider D]

The confirmed affected GPUs are the mobile 8400, 8600, and 8700. All of them, every single one. However, these are just the chips revealed to be defective by Dell. As of yet we still have no idea if any of the desktop GPUs are defective. Nvidia have been deliberately vague, not publicly specifying which chips are likely to be faulty. Apparently us customers, who are the source of all their income, aren't important enough to reveal that information to.

It should be noted though, that the defect has to do with temperature. High tempertures may eventually cause the hardware to malfunction, or even die. Thus if you're an office user who never games, your GPU is far less likely to fail. It's the power users, and gamers that really have to watch out.

 

[piratepast40]

^ Thanks for some real world and relevant info Spider. Unfortunately the uneducated are squawking the most and not looking to see if they are actually affected - just want to jump on the "the world is unfair and they're screwing me - whaaa" bandwagon.

If you own one of the laptops with these chips just go to the appropriate forum to see if a bios update was issued for your model - that should help lower temps. IMO, it's the OEM's that should be suing. They're the ones that purchased the product and now have to deal with their own warranty issues and customer dissatisfaction.

 

[eccentric909]

[citation][nom]Lempira72[/nom]Only In America !![/citation]

European companies are getting hit with an ugly legal stick as more companies engage in U.S.-style litigation, a new survey shows. The disputes rarely come cheap, and the costs are showing up in the form of higher premiums for commercial policy holders.

...

In the past three years, 38 percent of companies have seen some increase in the number of cases brought against them, and 34 percent have experienced growth in the size of claims, according to the report.

...

Among companies with annual revenues of more than $1 billion, nearly 90 percent have faced a lawsuit at some point in the past three years; and 30 percent have faced lawsuits aimed at their directors and officers, the report found.

http://findarticles.com/p/articles/mi_m0BJK/is_8_19/ai_n27915361

Yes, this only happens in America.. While it might be worse here, don't think for a second it's "only in america".

 

[Guest]

There are some RUMOURS that the only cards affected by the problem are the 8xxx series, and the main reason for re-branding the old 8xxx cards as 9xxx series was to diferenciate the "deffective" cards from the "working" ones. Just like AMD did with the phenoms (9x00 and 9x50's)...I guess only time will tell if there is any truth to that.

 

[caamsa]

@V3NOM yea I don't get it. Typical what? I get voted down for loving my country? That is sad indeed.

I hope Nvidia recovers from the unfortunate situation.

 

[maximiza]

I heard the SEC was investigating Nvidia also. That means some criminal activity might have happened. Well I guess we will see if the business model of fabless companies is flawed or not.

 

[DXRick]

Ironic isn't it? If it weren't for the lawsuit (and product liability laws in the US), people in other countries would be victims of this type of fraud too. So, instead of being grateful that we have mechanisms to hold CEOs accountable, they deride us for it. I would love to hear how other countries deal with corporate fraud.

 

[spartanii]

ya nivida should be held accountable but they shouldnt have to pay share holders it should be to the consumers and retailers who got stiffed..investing is a gamble you get burned by hype and following the band wagon you shouldn't invest in a company just because its doing well now you have to look at the long term ramifications..ooo look nivida is doing well lets buy lots of stock...oh no it dropped hardcore, wtf man i want a do over..and of course if they new about a problem with a product they would keep it hush hush for as long as possible and they did as much as they could to fix the flaws its not like they just said screw it and did nothing to fix it (im pretty sure they did fix it for the most part). And even if they did tell everyone about the flaw as soon as they knew, what good would it have that done? It just would have hurt there current share holders and they would be complaining just as much.

 

[DXRick]

Well, the big question is "Did the insiders sell their holdings while denying there was a problem?"

That is what the SEC will investigate, and if they are caught they will be tried as criminals.

You can deride the lawsuit frenzy in the US, as there are many frivolous ones. However, it is often these suits that fill in where the law misses, especially when it comes to holding insiders accountable. The problem is that they have to prove intent to defraud, to prove that a crime occurred, which is really difficult.

Also, don't worry about Nvidia. There are also laws in the US that prevent lawsuits from bankrupting a company (ie they limit the damages to what the company can afford to pay).

 

[eklipz330]

i hate this sue you bs, but its good to see some legitimate reasons other than rambus's claims... as well as other dum sh|t... NEW YORK FTW

 

[miribus]

Affected customers have a right to be outraged, and sue, if a company is knowingly selling bad merchandise. I'm not a litigious person by any stretch of the imagination, but what else are you realistically supposed to do?
If you're a shareholder, or someone who had recently purchased stock of a company who is dealing in bad merchandise are you just supposed to say "Oh well."
This isn't a "I spilled coffee on myself, now pay me." situation.

 

[nekatreven]

[citation][nom]Miribus[/nom] This isn't a "I spilled coffee on myself, now pay me." situation.[/citation]

Just shut up if you don't know what you're talking about. That woman spent a week in the hospital dealing with 3rd degree burns and having to endure skin grafts due to a problem that McDonalds knew about for YEARS.

More info: http://lawandhelp.com/q298-2.htm


In other news...if you are sure you have a defective part and you have some warranty left...set your rig up next to a space heater and run F@H. Hurry before the warranty expires.

 

[miribus]

[citation][nom]nekatreven[/nom][/citation]
I didn't pick the best example of a frivolous lawsuit because a similar genuine one exists. I understand that, no need to be rude.
I guess I could have picked something less contentious.

However,

For some obsessed with detail you managed to completely let the point whizz by your head.

I was pointing out that blatant lies nVidia was telling, and allowed them to continue to sell defective merchandise was a legitimate complaint.

Secondly, I can point to pages on the interwebz that agree with me too:
http://overlawyered.com/2005/10/urban-legends-and-stella-liebeck-and-the-mcdonalds-coffee-case/
As the saying goes: "If it's on the internet..."

The claim that McDonalds makes their coffee hotter is nonsense, 190F, the correct temperature which is just below boiling, CAN cause 3rd degree burns.
Any properly prepared coffee can do that.

See how pointless this is?

And your suggestion to fix the problem of defective parts is worthless. Apparently ALL of them are broken, at least in terms of how they were advertised. You're going to purposely break a part just to get a broken one back?

I have no problem with nVidia saying mea culpa after the fact, people make mistakes, they just should have done it much earlier.
This of course presumes they're guilty of hiding the fact as the lawsuit alleges, maybe they did, maybe they didn't, but it's worth looking into if I were a shareholder who just lost an investment.

 

[miribus]

I should say, "if it's true that all of them are broken."