US - Investors in the shareholder derivative suit concerning options backdating at UnitedHealth Group Inc have been awarded US$920m from its officers.
BLB&G said in a statement that William McGuire, the former CEO of UnitedHealth, would pay more than $615m to have the claims against him resolved, former COO and Current CEO Stephen Hemsley would pay approximately $240m, and former General Counsel David Lubben would pay $30m to have the claims against him resolved.
In addition, more than $35m would be recovered from other UnitedHealth officers. Chad Johnson, who represents BLB&G's clients in the UnitedHealth case, said: "This historic recovery could not have been achieved without the dedication of the public pension funds which served as the lead plaintiffs in this litigation.
"This result sends a clear message to corporate executives everywhere that if you abuse your position for personal gain at the expense of shareholders, you will be held accountable by institutional investors such as those who served as the Lead Plaintiffs here."
BLB&G has also announced the establishment of a new practice group to protect the interests of its investor and consumer clients in the wake of the collapse of the sub-prime mortgage industry and the continuing accusations of misconduct by mortgage lenders, bankers and rating agencies.
Gerald Silk, partner, BLB&G said: "With the recent announcements of major write-downs being taken by leading financial institutions as a result of exposure to sub-prime and other mortgage-backed investments, and the revelation that respected institutional investment managers were gambling their clients' retirement savings on investments in exotic instruments, it has become clear that the collapse of numerous sub-prime lenders earlier this year marked just the tip of the iceberg."
The Sub-prime Litigation Practice Group will handle the full range of litigation matters related to the sub-prime collapse, including claims on behalf of investors in mortgage lenders, companies in related industries, and financial institutions that have concealed their exposure to losses from mortgage-backed securities, and investors in CDOs and other financial instruments tied to mortgage-backed securities.
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