this post was submitted on 08 May 2025
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UnitedHealth sued by shareholders over its reaction to backlash from executive's killing (www.reuters.com)
submitted 3 days ago by ByteOnBikes@slrpnk.net to c/business@lemmy.world
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NEW YORK, May 7 (Reuters) - UnitedHealth Group (UNH.N) , opens new tab was sued on Wednesday for allegedly concealing how backlash from the killing of a top executive was damaging its business, causing its stock to nosedive after the insurer lowered its 2025 outlook.

In a proposed class action filed in Manhattan federal court, shareholders said the insurer defrauded them after the December 4 shooting of UnitedHealthcare Chief Executive Brian Thompson by shifting away from strategies that led to higher-than-average claims denials, without revealing the impact on profitability.

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[โ€“] sugar_in_your_tea@sh.itjust.works 14 points 3 days ago (1 children)

without revealing the impact on profitability

I think this is the real issue. Perhaps they lied about expected profitability going forward, and that's a big no-no for publicly traded companies.

Shareholders said UnitedHealth had previously inflated its stock price by recklessly sticking with its old forecast, even as mounting public anger and an October 17 U.S. Senate report, opens new tab on claims denials caused it to become more patient-friendly.

The suit isn't that they didn't stick to their old strategy, but that they presented false forecasts about what impact the change would have.

[โ€“] Grimtuck@lemmy.world 9 points 3 days ago* (last edited 3 days ago)

Exactly. Their continued investment was based on them killing as many customers as possible. They lied about the financial impact and would have divested if they realised saving people's lives wasn't going to make them as much money.