> I believe it was the affair with the married subordinate that was the real problem. There's a huge amount of legal exposure for NVidia with that

For someone not familiar with American law: How the fuck is that a bigger problem than the Chinese spy ?

Is there any explicit rules at NVidia forbidding that in a code of conduct somewhere ?

It's not. That's a strange statement to make, particularly the emphasis on "married". It seems that person is implying that if a married woman participated in the affair, it was due to coercion. A sexual harassment lawsuit would mainly be a liability in the court of public opinion.