UnitedHealth Sued by Investor Over Strategy After CEO Murder (2)

UnitedHealth Group Inc. misled investors about its corporate strategy as the company faced significant public scrutiny following the December killing of CEO Brian Thompson on a Manhattan street, a proposed class action filed Wednesday said.

Share prices plummeted more than 22% April 17 after the insurer lowered its full-year 2025 net earnings outlook, with the company indicating “heightened care activity” for beneficiaries of Medicare Advantage, investor Roberto Faller told the US District Court for the Southern District of New York. It was the stock’s steepest one-day fall since 1998, according to data compiled by Bloomberg.

This lowered 2025 outlook signaled there had been a softening in corporate strategy unbeknownst to investors as individuals and policymakers questioned UnitedHealthcare’s denials of coverage, Faller said.

Thompson, who led UnitedHealth’s insurance business UnitedHealthcare, was shot from behind at the New York Hilton Midtown while en route to an investor conference Dec. 4. “It is commonly believed that the accused killer’s motivation to attack Mr. Thompson was due to anger regarding UnitedHealthcare’s policies” under his tenure, Faller said in his complaint. Profits increased with Thompson’s leadership, Faller said, but the company “became increasingly controversial due to denials of coverage.”

Prior to Thompson’skilling, a US Senate subcommittee reported that prior authorization requests for post-acute care for Medicare Advantage enrollees were denied by UnitedHealthcare and other insurers at higher rates than for other forms of care, Faller said. News outlets before and after Thompson’s murder reported on UnitedHealthcare’s curbing of coverage, the complaint said. After, media highlighted how patients, doctors, and lawmakers reactions’ to his death signaled ire toward the overall insurance industry.

UnitedHealth said it was sticking to its 2025 outlook on Jan. 16, the complaint said. This was misleading, Faller said, as it didn’t disclose the company was “no longer willing” to “use the aggressive, anti-consumer tactics” it needed to achieve its prior forecast as it was embroiled in heightened public hostility. On April 17, UnitedHealth said its 2025 net earning outlook would be lowered to $24.65 to $25.15 per share, previously estimated at $28.15 to $28.65, and its adjusted earnings dropped to $26 to $26.50 per share, previously being $29.50 to $30.00, according to the complaint.

“The magnitude of the April 17, 2025 drop was such that it caused the Dow Jones Industrial Average to fall by 1.3%,” Faller said.

Luigi Mangione has been charged in both federal and state court with killing Thompson. He has pleaded not guilty in both cases. US Attorney General Pam Bondi has said Justice Department lawyers prosecuting him should seek the death penalty.

Mangione saw an outpouring of support since being accused of the killing; his legal defense fund surpassed $1 million in donations this week.

UnitedHealth and UnitedHealthcare didn’t immediately respond to emails seeking comment.

The Rosen Law Firm PA represents Faller, who seeks to represent a class of investors from Dec. 3, 2024—when it issued its fiscal guidance—through April 16, 2025. The investor is suing the group, CEO Andrew Witty, and CFO John Rex for alleged Securities Exchange Act of 1934 violations. Faller seeks damages, among other relief.

The case is Faller v. UnitedHealth Grp. Inc., S.D.N.Y., No. 1:25-cv-03799, complaint filed 5/7/25.