Nvidia’s board of directors said on Tuesday that it hired Wachtell, Lipton, Rosen & Katz to conduct an investigation of CEO Jensen Huang and whether company secrets or national security was compromised, after Huang admitted to having an affair with a woman who has been connected to Chinese intelligence.
“The independent members of the NVIDIA Board have retained former acting U.S. Attorney of the Southern District of New York Joon H. Kim and his firm Wachtell, Lipton, Rosen & Katz to conduct a thorough and independent investigation as was announced on Sunday,” the board said in a statement.
Kim joined the firm last month, and he was previously the chief U.S. prosecutor in Manhattan, according to Law360.
Nvidia has been thrust into turmoil since Huang’s acknowledgement of the affair over the weekend. The chipmaker’s stock dropped 6% on Tuesday after falling more than 4% on Monday, as investors worry that the investigation and scandal could result in the co-founder and CEO being forced out.
Nvidia and the board are facing pressure from critics and politicians over what the company knew about sales of its restricted AI chips to Chinese companies.
Over the past few weeks, The New York Times and Financial Times have reported that U.S. intelligence agencies surveilled an Asian technology executive, Alice Huang, who has been affiliated with Nvidia customer Megaspeed. These agencies have concluded that she is passing information to Beijing and is involved with Chinese intelligence, according to the reports.
Huang has become the face of the AI industry, going by his first name “Jensen” to customers and rivals as Nvidia’s technology is used to train nearly all major AI models. The chipmaker has become an essential source of financing for AI startups and Huang has met with presidents and CEOs around the world as Nvidia’s public face.
But Huang’s actions have thrown the chipmaker into instability as he admitted to an affair with Alice Huang in an email to staff on Sunday.
“My actions hurt her and our children. There is no excuse for what I did,” Huang wrote in the message, while emphasizing that he is an American and supports U.S. national security.
An Nvidia representative said at the time that Huang was committed to continuing as CEO of Nvidia without interruption.
On Sunday, Nvidia’s board said that it would investigate the allegations that Huang had been the target of a foreign intelligence effort.
Nvidia’s board also said on Sunday that it has no reason to believe either national security nor Nvidia secrets were compromised.
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