Cigna Settles Six Class-Action Lawsuits Over Merger With Anthem
Health insurer Cigna has agreed to settle six class-action lawsuits that all challenge a merger agreement between the company and Anthem, Modern Healthcare reports (Herman, Modern Healthcare, 11/30).
In July, Anthem announced that it agreed to acquire Cigna for $48.4 billion. The combined company would have about 53 million customers, which would make it the nation's largest insurer in terms of enrollment.
Federal regulators must approve the proposal, and antitrust experts say the Department of Justice and state attorneys general are likely to scrutinize them closely. DOJ will review the proposal over the next year or longer (California Healthline, 11/12). The companies' CEOs expect federal regulators to approve the proposal.
Following the announcement, some of Cigna's shareholders filed lawsuits against the company, arguing that the merger deal would not provide them with adequate compensation. In addition, the suits alleged that the deal was made despite various conflicts of interest. The settlement effectively ends six class-action complaints challenging the deal.
Cigna did not disclose how much it would pay under the settlement. The company stated in a federal filing that it reached the settlement "solely to avoid the costs, risks and uncertainties inherent in litigation." Cigna did not admit to any wrongdoing or liability under the settlement.
According to Modern Healthcare, Anthem and Cigna shareholders will vote Thursday on whether to approve the proposed merger deal. Most shareholders are expected to support the merger, Modern Healthcare reports (Modern Healthcare, 11/30).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.