article (here) states that “if approved by a court, the settlement …would be the largest ever in a ‘derivative’ suit…according to data compiled by Bloomberg.” Separately, the SEC announced on December 6, 2007 (here) that it had reached a 8 million enforcement action settlement with Mc Guire, which, the SEC said, includes the “largest penalty assessed against an individual in an options backdating case.” The 8 million SEC settlement consists of “a milllion civil penalty and reimbursement to the Minneapolis-based health care company for all incentive- and equity-based compensation he received from 2003 through 2006.” The SEC’s press release also stated that the Mc Guire settlement “is the first with an individual under the ‘clawback’ provision (Section 304) of the Sarbanes-Oxley Act to deprive corporate executives of their stock sale profits and bonuses earned while their companies were misleading investors.” According to United Health’s press release, Mc Guire’s settlement consists of the following elements: According to the company.
these amounts, combined with a previous repricing of all stock options awarded to Dr.
The scale of these settlements could have a significant impact on at least some of the other pending options backdating derivative cases, particularly where the company has been forced to restate and where top company officials have personally benefited from the backdating.
Readers should note that the table I am maintaining of all options backdating related settlements, dismissals and denials can be accessed here.
The same day as the board meeting, some United Health directors and executives were supporting a campaign by Mr. All told, United Health-affiliated donors have contributed ,000 to the campaign.[...]When the donations to the Kean Senate campaign were described to former SEC Chairman Harvey Pitt, he said they struck him as "ill-advised and strange" and something that could be seen as an attempt to influence a witness because of the senior Mr. A spokeswoman for the Kean campaign said the fund raising came at a "United Health breakfast" hosted by Minnesota Republican Sen.
The United Health press release also stated that under the settlement agreement that the company reached with its former director William Spears, “the fair settlement value of the Company’s claims …
will be determined by binding arbitration.” According to the article, current United Health CEO Stephen J.
Helmsley had agreed to repay 0 million, although the company apparently says he voluntarily did so months ago.
On December 6, 2007, United Health Group announced (here) that its Special Litigation Committee had concluded its review of claims relating to the company’s option backdating practices that had been brought against certain of the company’s directors and officers.
The company also announced that its former CEO William Mc Guire had agreed surrender certain rights and interests which, together with previous repricing of all stock options awarded to Mc Guire, have a value in excess of 0 million.