Fonds des Missions v. UnitedHealth Group Inc.

Summary

The United States District Court for the District of Columbia denied Fonds des Missions’ motions for a preliminary and permanent injunction seeking to compel UnitedHealth Group Inc. to include a shareholder proposal in its proxy materials. The proposal requested a report concerning the healthcare consequences of UnitedHealth Group’s acquisitions over the preceding ten years. The court concluded that the plaintiff had not shown a likelihood of success on its claim that the proposal was improperly excluded under SEC Rule 14a-8(i)(7), and denied the permanent-injunction motion without prejudice.

Holdings

1. Plaintiff did not make the clear showing required to establish a likelihood of success because the proposal, as worded, did not clearly focus on significant policy issues transcending UnitedHealth Group's ordinary business operations.
2. The motion for a preliminary injunction was denied because plaintiff failed to show a likelihood of success on the merits.
3. The court denied the motion for a permanent injunction without prejudice and declined to resolve the merits with prejudice on the existing record.

Questions Presented

1. Whether plaintiff showed a likelihood of success on its claim that UnitedHealth Group improperly excluded its shareholder proposal under the ordinary-business exclusion in 17 C.F.R. § 240.14a-8(i)(7).
2. Whether the proposal focused on sufficiently significant social-policy issues that transcended UnitedHealth Group's day-to-day business matters under the SEC's 1998 interpretive release.
3. Whether plaintiff was entitled to a preliminary injunction compelling inclusion of the proposal in UnitedHealth Group's proxy materials.
4. Whether the court should resolve the merits and permanently enjoin exclusion of the proposal at the preliminary stage.

Disposition

other