A federal judge has thrown out most of a securities fraud lawsuit brought by the country’s largest pension fund against UnitedHealth Group, but will let claims that the company misled investors about previous asset sales move forward.
The California Public Employees’ Retirement System (CalPERS) originally sued in May 2024, alleging UnitedHealth, former CEO Andrew Witty and current CEO and board chair Stephen Hemsley deceived investors about the company’s Medicare Advantage business, including alleged upcoding that inflated payments from CMS. An amended complaint filed in 2025 covers investors who bought stock in the company between September 2021 and July 2025.
On Sept. 30, Judge Jeffrey Bryan of the U.S. District Court for the District of Minnesota permanently dismissed claims tied to 43 of 48 public statements made by UnitedHealth and its executives that CalPERS alleged didn’t provide investors with an accurate view of the company’s operations, including comments about the its in-home assessment program, nursing home hospitalization rates and Optum’s data firewalls.
The remaining claims center on what UnitedHealth called “business portfolio refinement.” In late 2024, the company sold stakes in certain business units to private equity and investment firms and booked about $3.3 billion in gains. CalPERS alleges the deals were meant to hide the financial hit from CMS’ V28 changes to MA risk adjustment and keep the company from missing earnings estimates for the first time in 60 consecutive quarters.
The judge also dismissed insider trading claims against Mr. Witty and Mr. Hemsley, finding CalPERS did not show either executive traded on nonpublic information, though CalPERS can refile them. Claims against former UnitedHealthcare CEO Brian Thompson were dismissed because the fund didn’t move to continue them in time after his death in late 2024.
“We are pleased that the court dismissed with prejudice virtually all of the alleged misstatements at the heart of this baseless case, and we look forward to defending ourselves on the merits as to the limited claims that remain,” a UnitedHealth spokesperson told Becker’s.
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