UnitedHealth Settles $69M 401(k) ERISA Class Action
UnitedHealth Group has settled a class-action lawsuit for $69 million, resolving allegations of fiduciary duty breaches under the Employee Retirement Income Security Act of 1974. The legal battle, starting in April 2021, focused on claims that UnitedHealth included underperforming Wells Fargo target-date funds in its 401(k) investment offerings.
The plaintiffs argued that UnitedHealth’s decision to retain these funds was influenced by its financial ties to Wells Fargo. Despite these claims, UnitedHealth has defended its choices, asserting that its fund selection and monitoring processes met ERISA standards.
Charles H. Field, counsel for the plaintiffs, described the settlement as a significant win for the approximately 300,000 plan participants involved in the case. Funds from the settlement will be distributed based on participants’ investments in the Wells Fargo funds and their relative performance during the specified period.
Leigh Anne St. Charles, another counsel for the plaintiffs, emphasized the lengthy legal process that led to this resolution. After years of litigation, both parties have come to an agreement, signaling an end to the contentious dispute.
The $69 million settlement, announced on Friday, represents a substantial recovery given the uncertainties of continued legal proceedings. This resolution is one of the largest in ERISA cases related to underperforming 401(k) investments.
Judge John R. Tunheim of the District Court for the District of Minnesota will preside over a fairness hearing to determine the final approval of the settlement. Class members will receive information about the terms of the settlement and their options for participation in the near future.
