CalPERS Reaches $895 Million Settlement With UnitedHealth
On Wednesday, UnitedHealth Group agreed to pay $895 million to settle a federal securities class-action lawsuit led by CalPERS regarding the backdating of executives' stock options, the Wall Street Journal reports.
UnitedHealth was one of the largest corporations to be accused of backdating stock options awarded to executives to let them increase the value of those options, according to the Journal.
Under the settlement, UnitedHealth also will adopt changes to its corporate governance policies.
Neither UnitedHealth nor any of the individuals named in the suit admit any wrongdoing in the settlement (Kardos, Wall Street Journal, 7/2).
The Alaska Plumbing and Pipefitting Industry Pension Trust also participated in the suit. The settlement agreement is subject to court approval (Ortiz, Sacramento Bee, 7/2).
In its announcement this morning, UnitedHealth also said that it has agreed to pay $17 million to settle another lawsuit related to stock options. The suit was brought under the Employee Retirement Income Security Act.
In addition, the insurer reduced its full-year earnings outlook to $2.95 to $3.05 per share before special items, down from a previous forecast of $3.55 to $3.60 per share (Krauskopf/Kaufman, Reuters, 7/2).