Judge promotes class action lawsuit against UnitedHealth retirement plan
On Thursday, a federal judge dismissed UnitedHealth Group’s motion to dismiss the class action lawsuit, which accused the healthcare giant of failing to effectively supervise the retirement plan management of its 200,000 employees and their families.
U.S. District Court Judge John Tunheim of Minnesota ruled that the plaintiff proved that the UnitedHealth Group’s 401(k) plan performed poorly compared to industry benchmarks over the course of 11 years, which reasonably proved the carelessness of the healthcare giant. The case was filed on behalf of plan participant Kim Snyder in April, accusing the defendant UnitedHealth Group, its board of directors, former CEO David Winchmann, and the company’s employee benefit plan investment and management committee for violating fiduciary duties under federal employee retirement income. Law.
The verdict stated that the plan holds approximately $15 billion in assets contributed by employees and is matched by UnitedHealth Group. Plan participants can choose from a variety of investment options in their 401(k), one of which is a target date retirement fund managed by Wells Fargo Bank.
The lawsuit alleges that Wells Fargo’s target date retirement funds from 2010 to 2060 have been below six key industry benchmarks for a long period of 11 years. The initial litigation compiled 33 tables that compared UnitedHealth Group’s retirement portfolio performance with other plan managers such as Morningstar.
The judgment stated that UnitedHealth Group attributed its slow performance to a more conservative investment strategy aimed at fending off the economic recession, and questioned the reliability and ability to compare it with other plan managers. The judge said that at this time it was concluded that it was too early to compare Wells Fargo’s measures with other plan managers.
The plaintiff and the collective demanded compensation for losses caused by poor execution of the plan, the divestiture of careless investments, and the removal of managers who violated ERISA’s responsibilities.
UnitedHealth Group did not immediately respond to an interview request.