Kotalik v. UnitedHealth Group Incorporated.

Background

Two putative class actions were filed in the United States District Court for the District of Minnesota, both alleging that UnitedHealth Group and its plan administrators violated their fiduciary duties under the Employee Retirement Income Security Act (ERISA) — the federal law governing employer-sponsored benefit plans — by improperly using forfeited contributions in the UnitedHealth Group 401(k) Savings Plan.

The first action, Kotalik v. UnitedHealth Group Incorporated (Case No. 25-cv-01751), was filed on April 28, 2025, by plaintiffs Theresa M. Kotalik, Debra A. Wisner, Kerry Clements, and Joseph L. Clement, individually and as representatives of a putative class of plan participants and beneficiaries. Defendants named were UnitedHealth Group Incorporated and the Administrative Committee for the UnitedHealth Group 401(k) Savings Plan.

The second action, Hendrickson v. UnitedHealth Group Inc. (Case No. 25-cv-02191), was filed on May 21, 2025, by plaintiff Holly Hendrickson on behalf of herself, the plan, and all others similarly situated. Defendants named in that case included UnitedHealth Group Inc., UnitedHealth Group Employee Benefits Plans Administrative Committee, David E. Strauss, and John Does 1-30. At the hearing, the parties also indicated they had agreed to stipulate to the dismissal of defendant Strauss.

On June 26, 2025, the court stayed the defendants' deadline to answer in both cases pending resolution of a forthcoming consolidation motion. On July 16, 2025, all named plaintiffs jointly moved to consolidate the cases, appoint interim co-lead counsel, set a deadline for a consolidated complaint, and establish a briefing schedule.

The Motion and the Parties' Positions

The plaintiffs moved for consolidation of the related actions under Federal Rule of Civil Procedure 42(a), which permits a court to consolidate actions involving a common question of law or fact. They sought: - Consolidation for both pretrial and trial purposes; - An 'In re UnitedHealth ERISA 401(k) Litigation' caption; - Appointment of Paul M. Secunda of Walcheske & Luzi, LLC and Gerald D. Wells, III of Lynch Carpenter, LLP as Interim Co-Lead Counsel under Federal Rule of Civil Procedure 23(g)(3); - A 30-day deadline to file a consolidated complaint; - A 30-day deadline for defendants to respond; and - Relief from responding to the individual complaints.

Defendants agreed to consolidation for pretrial purposes, agreed to the appointment of the proposed interim co-lead counsel, and agreed that plaintiffs should file a consolidated complaint. However, defendants opposed: (1) consolidation for trial, arguing it was premature because future plaintiffs might raise new claims; (2) the 'In re' caption, arguing it was inconsistent with Federal Rule of Civil Procedure 10(a); and (3) a fixed 30-day response deadline, asking instead for a meet-and-confer on scheduling. After the July 30, 2025 hearing, the court took the motion under advisement.

Consolidation Analysis

Common Questions of Law and Fact

The court found the Rule 42(a) threshold requirement — a common question of law or fact — clearly met. Both complaints contain substantially similar factual allegations about how defendants used forfeited plan contributions and both allege this usage violated defendants' ERISA fiduciary duties. The defendants themselves did not dispute the existence of common questions.

Pretrial Consolidation

The court found consolidation for pretrial purposes appropriate and undisputed. The similarity of the complaints pointed to efficiencies including avoiding duplicative discovery and duplicative motions. The court found no prejudice to any party, given the early stage of both cases.

Trial Consolidation

The court overruled defendants' objection to trial consolidation. Defendants argued it was premature because it was unknown whether trial consolidation would promote efficiencies and because new plaintiffs might bring new claims. The court found these arguments speculative, noting that the same efficiencies justifying pretrial consolidation pointed toward trial consolidation, and that speculative future developments could be addressed through a motion for separate trials under Rule 42(b) if they materialized.

'In re' Caption

The court rejected defendants' objection to the 'In re UnitedHealth ERISA 401(k) Litigation' caption. Defendants relied on a single non-binding district court decision (Moyer v. Michaels Stores, Inc., N.D. Ill. 2014) that rejected such a caption under Rule 10. The court found this unpersuasive, noting that 'In re' captions are routinely used in this district, including in ERISA matters, citing three prior cases in the District of Minnesota.

Appointment of Interim Co-Lead Counsel

Under Rule 23(g)(3), courts may designate interim counsel to act on behalf of a putative class before the class is certified. Rule 23(g)(1)(A) directs courts to consider: (i) work done investigating potential claims; (ii) experience in class actions and the type of claims at issue; (iii) knowledge of applicable law; and (iv) resources counsel will commit to representing the class.

The court found that Attorney Secunda has extensive knowledge of ERISA law and managing ERISA class actions, and that Attorney Wells has ample experience in class action and ERISA litigation. Both law firms were found to have sufficient resources. Both attorneys had been involved in the related actions since the complaints were filed. Defendants did not object to their appointment. The court appointed both as Interim Co-Lead Counsel.

Order

The court granted the motion in full. Key provisions of the order: - The two cases are consolidated for both pretrial proceedings and trial before U.S. District Judge Eric C. Tostrud and U.S. Magistrate Judge Elizabeth Cowan Wright. - The lead case is Kotalik et al. v. UnitedHealth Group Incorporated, No. 25-cv-01751, and all future filings must bear the caption In re UnitedHealth ERISA 401(k) Litigation. - Case No. 25-cv-02191 is administratively closed. - Any future related cases filed or transferred to this court are automatically consolidated. - Plaintiffs must file a consolidated complaint within 30 days of this order. - The parties must meet and confer and submit a proposed briefing schedule within 7 days of the filing of the consolidated complaint. - Paul M. Secunda and Gerald D. Wells, III are appointed Interim Co-Lead Counsel, with sole authority to communicate with defendants' counsel and the court on behalf of all plaintiffs unless expressly delegated. - All other plaintiffs' counsel must act only at the direction of Interim Co-Lead Counsel.