An executive who once headed a health insurance giant has agreed to pay $30 million to resolve a federal securities class-action suit, a law firm says.
Dr. William McGuire, the former chairman and chief executive officer of UnitedHealth Group Inc., Minnetonka, Minn., has accepted the settlement in connection with efforts to resolve the suit, which was filed in the U.S. District Court in Minnesota, according to lawyers at Latham & Watkins L.L.P., Washington, who represented McGuire.
In addition to making the cash payment, McGuire has agreed to return about 3.7 million shares of UnitedHealth stock options to UnitedHealth.
McGuire continues to deny the allegations in the class-action complaint, McGuire’s lawyers say.
The lead plaintiff is the California Public Employee Retirement System.
UnitedHealth, another defendant in the suit, already has agreed to pay $895 million to the plaintiffs.
“I am pleased to be able to help bring the stock option dating issues closer to complete resolution,” McGuire says in a statement about the latest agreement. “As CEO, I consistently took responsibility to help address important issues facing UnitedHealth Group, and I have continued to do my part to resolve stock option dating issues since leaving the company. I remain extremely proud of the outstanding group of men and women at UnitedHealth who helped improve the health and well-being of people while building a highly innovative and successful company.”
In December 2007, McGuire agreed to settlements with the U.S. Securities and Exchange Commission and the UnitedHealth Group Special Litigation Committee. Those settlements still must be approved by the court.
CalPERS is welcoming the announcement of the McGuire settlement agreement.
Peter Mixon, CalPERS General Counsel. “This precedent-setting recovery demonstrates that the company’s true owners – shareowners – will hold CEOs accountable for disregarding principled corporate governance,” CalPERS General Counsel Peter Mixon says in a statement.