UnitedHealth Group Agrees to $69 Million Settlement in ERISA Class Action Lawsuit

Posted on February 11th, 2025 at 2:07 PM
UnitedHealth Group Agrees to $69 Million Settlement in ERISA Class Action Lawsuit

From the desk of Jim Eccleston at Eccleston Law

UnitedHealth Group has agreed to pay $69 million to resolve a class action lawsuit alleging violations of its fiduciary duties under the Employee Retirement Income Security Act of 1974 (ERISA). The settlement, believed to be the largest ever for an ERISA case involving poorly performing 401(k) investment options, ends three years of litigation in Snyder v. UnitedHealth Group, et al.

The lawsuit, filed in April 2021 by former UnitedHealth employee Kim Snyder, alleged that UnitedHealth imprudently retained the Wells Fargo Target Fund Suite in its 401(k)-investment menu despite its poor performance. InvestmentNews reports that the funds significantly underperformed six benchmarks over 11 years, yielding lower cumulative and annualized returns than comparable options.

The suit claimed UnitedHealth prioritized its corporate relationship with Wells Fargo, a major financier and customer, over its fiduciary duty to plan participants. Specifically, it alleged that UnitedHealth executives, including CFO John Rex, intervened to keep the underperforming Wells Fargo funds in the 401(k) plan. These actions, the plaintiffs argued, breached ERISA’s standards of loyalty and prudence.

According to InvestmentNews, this landmark settlement underscores the importance of fiduciary diligence in selecting and monitoring 401(k) investment options. It also highlights the legal risks of prioritizing corporate relationships over participant interests. ERISA requires fiduciaries to act solely in the best interests of plan participants and to make prudent, loyalty-driven decisions regarding investment options.

 

Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, transition, regulatory, and disciplinary matters.

Tags: eccleston, eccleston law

Return to Archive

TESTIMONIALS

Previous
Next

You were most helpful with my FINRA deposition. You are a good lawyer and a good person.

Dan B.

LATEST NEWS AND ARTICLES

June 25, 2025
FINRA Fines and Suspends Advisor for Selling Away and Receiving Client Loans

The Financial Industry Regulatory Authority (“FINRA”) has sanctioned Jose Antonio “Tony” Navarro for selling unapproved investments and borrowing funds from clients.

June 24, 2025
Dr. Cash Sentenced for Defrauding Retirees

Terrence Chalk, an unregistered investment advisor who operated under the alias “Dr. Cash,” has been sentenced to three years in prison for orchestrating a fraudulent investment scheme that defrauded millions from unsuspecting victims.

June 23, 2025
FINRA Fines AAG Capital for RILA Exchange Violations

The Financial Industry Regulatory Authority (“FINRA”) has fined AAG Capital $100,000 and ordered the firm to pay nearly $39,000 in restitution after finding it violated Regulation Best Interest (“Reg BI”) by recommending costly registered index-linked annuities (“RILAs") to retail clients in unsuitable product excha...