Calpers heads to court against US healthcare company
Calpers, which owns a 0.2 per cent stake in UnitedHealth Group, is suing the company over allegations it engaged in “widespread, fraudulent and deceptive schemes” to maximise its revenue (TNS/ABACA via Reuters)
A US federal judge ruled that UnitedHealth Group must defend itself against part of a lawsuit from the largest pension fund in the US, which alleges the company misled shareholders about the purpose of deals that added $3.3bn to earnings in 2024.
US District Judge Jeffrey Brian issued a ruling stating that Calpers may proceed with its claims UnitedHealth deceived investors about financial transactions aimed to boost earnings, though he struck down most of the other claims filed by the pension system.
Calpers owns a 0.2 per cent stake in UnitedHealth, which sells health insurance and healthcare services, which is worth about
The pension fund had alleged UnitedHealth engaged in “widespread, fraudulent and deceptive schemes” to maximise revenue and share value, misusing medical codes to increase insurance payments in a practice known as upcoding.
The pension system also alleged the company engaged in widespread misconduct over a four-year period which caused its share price to nosedive in 2025, and that UnitedHealth sold stock based on insider knowledge related to the schemes.
Bryan ruled Calpers’ other claims lacked evidence to move forward, describing the claims as “vague or optimistic rhetoric,” or “puffery”.
“For its part, Calpers argues that defendants made strategic omissions and misleading statements to investors regarding the reason for and nature of the transactions,” the ruling reads. “The court agrees with Calpers.”
The ruling allows Calpers to move forward with evidence-gathering in the approved parts of the case.
“Investors have a right to accurate and transparent disclosure about the source of a company’s earnings,” Calpers general counsel Prashant Yerramalli told AOX. “We are glad the court sustained our allegations concerning accounting practices and look forward to moving forward with this important litigation on behalf of our members.”
A UnitedHealth spokesperson said: “We are pleased that the court dismissed with prejudice virtually all of the alleged misstatements at the heart of this baseless case, and we look forward to defending ourselves on the merits as to the limited claims that remain.”