Staff Reporter
UnitedHealth Group faced a lawsuit on Wednesday, accused of concealing the financial fallout from the tragic killing of its CEO, Brian Thompson.
This backlash reportedly hurt the company’s business and led to a significant drop in stock value after the insurer revised its 2025 profit outlook downward.
In a proposed class action filed in federal court in Manhattan, shareholders claimed that UnitedHealth misled them following Thompson’s shooting on December 4.
They argue that the company shifted away from strategies that had previously resulted in higher claims denials without disclosing how this change would impact profitability.
On April 17, UnitedHealth’s shares plummeted by 22%, erasing around $119 billion in market value.
This decline followed the company’s announcement that it was revising its adjusted profit per share forecast for 2025 from between $29.50 and $30 to between $26 and $26.50.
The insurer cited rising costs in its Medicare division as a contributing factor and had issued its original forecast just a day before Thompson’s death.
Shareholders contended that UnitedHealth had artificially inflated its stock price by holding onto its outdated forecast, despite growing public anger and an October 17 Senate report that highlighted issues with claims denials, prompting the company to adopt a more patient-friendly approach.
UnitedHealth has not commented on the lawsuit. The company operates offices in Eden Prairie, Minnesota, and Washington, D.C.
The lawsuit seeks unspecified damages for shareholders from December 3, 2024, to April 16, 2025. Both Chief Executive Andrew Witty and Chief Financial Officer John Rex are also named as defendants.
Luigi Mangione, accused of murdering Thompson in midtown Manhattan, has pleaded not guilty. Meanwhile, he has garnered support from some Americans frustrated with for-profit health insurers that deny necessary treatments.
The case is titled Faller v. UnitedHealth Group Inc et al, filed in the U.S. District Court for the Southern District of New York, No. 25-03799.
