The US Department of Justice is examining whether Nvidia structured its deal with AI chipmaker Groq in a way meant to sidestep antitrust review. Groq had described the arrangement, announced in December, as a non-exclusive licensing agreement giving Nvidia access to its AI-specific chips. As part of the deal, Groq's chief executive Jonathan Ross and chief operating officer Sunny Madra moved to Nvidia.
The New York Times noted that AI companies have increasingly relied on deals combining technology licensing with the hiring of key personnel, rather than pursuing outright acquisitions, a structure that often avoids the automatic government review triggered by traditional mergers.
Investigation opened soon after deal was announced
According to the report, the Justice Department opened its inquiry shortly after the Groq-Nvidia deal was made public and has since sent Nvidia a formal request for information. The people cited by the Times said that if wrongdoing is found, the agency could impose a fine on Nvidia, but would likely not seek to unwind the deal itself. They cautioned that no conclusion has been reached and that the department could ultimately clear the companies of any violation.
Nvidia responds
Nvidia spokesperson John Rizzo told NYT that the Groq deal reflected the American system functioning as intended, rewarding entrepreneurs and benefiting consumers, and that the law was meant to protect the rights of inventors and workers to pursue new ventures, the Times reported.
Groq continues to operate independently
Unlike some firms that are left as shells after such arrangements, Groq has continued functioning as a business, the report said. The company still sells cloud computing services and announced in August that it was raising $350 million in a funding round in which Nvidia planned to participate.
Nvidia's expanding influence
The scrutiny comes as Nvidia, now valued at $5.4 trillion, has become a major financial backer across Silicon Valley, using its resources to support AI startups and channel funds to customers. The report also pointed to chief executive Jensen Huang's close ties with President Trump, who has called Huang "an incredible guy" and took him along to a summit with China's leader in May. Huang, in turn, has praised Trump for rolling back regulations and encouraging AI investment.
