UnitedHealth Group Inc. has agreed to pay more than $900 million to resolve shareholder option backdating lawsuits. The settlement, which is the largest settlement to emerge from an options-backdating case, comes nearly two years after revelations of stock-options backdating triggered the ouster of UnitedHealth’s longtime chief executive, William McGuire. The settlement puts most of UnitedHealth’s legal issues stemming from the scandal behind it. UnitedHealth’s stock-options problems had remained a distraction, partly because a class-action lawsuit led by the California Public Employees’ Retirement System grew more contentious and public in recent months.
Since 2006, dozens of companies have been found to have manipulated the dates on which stock options were awarded. In retrospectively picking dates when stock prices were at low points, they allowed executives the chance to reap outsize gains. The scandal has led to more than 80 financial restatements, dozens of executive dismissals, and civil and criminal government investigations. In the second-largest backdating settlement to date, Brocade Communications Systems Inc. agreed a month ago to pay $160 million to settle a shareholder class-action suit.
Source: Wall Street Journal
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