UnitedHealth Group has asked a Minnesota federal court to throw out a proposed class action lawsuit filed against it by the country’s largest pension fund.
The lawsuit, originally filed by the California Public Employees’ Retirement System (CalPERS) in May 2024 and amended multiple times, accuses UnitedHealth of securities fraud related to Medicare Advantage, claiming the company misled investors about its operations, including MA billing practices that inflated its revenue.
The lawsuit also alleges that UnitedHealth executives, including CEO and board chair Stephen Hemsley, former CEO Andrew Witty, and former UnitedHealthcare CEO Brian Thompson, engaged in insider trading by selling company stock based on nonpublic information about a Department of Justice investigation into the company’s billing practices.
In July, the company said it was complying with criminal and civil investigations into its MA business following reports earlier in the year on the topic from The Wall Street Journal. UnitedHealth also set a new 2025 earnings guidance that month after originally lowering its outlook in April and then suspending it in May over unanticipated MA cost trends.
CalPERS claims that the drop in UnitedHealth’s stock price, which followed news about the DOJ investigation and the company’s 2025 earnings guidance, was due to alleged misstatements about its MA billing. CalPERS is seeking compensatory damages for investors who purchased the company’s stock between September 2021 and February 2025, arguing that they were misled about the company’s internal operations. The pension fund oversees about $500 billion in assets for public sector retirees in California.
UnitedHealth is arguing that the complaint shows a lack of actionable misstatements, insufficient evidence of fraudulent intent, and an absence of causality between the alleged misstatements and stock losses. The company has consistently defended its MA business, saying that it is in full compliance with government regulations.
