McGuire defense: I'm not an accountant (United Health Care) - www.startribune.com
McGuire defense: I'm not an accountant
By DAVID PHELPS, Star Tribune
Last update: June 2, 2008 - 10:58 PM
A stock-option scandal cost Dr. William McGuire one of the top
health care jobs in the nation. Now he says he was simply following the
questionable advice of his top legal and financial advisers.
McGuire's lawyers are expected to argue later this month that the
former CEO of UnitedHealth Group relied on others to assess the
legality and appropriateness of backdated stock options granted to top
executives and new hires. As such, all allegations against him in a
shareholder's lawsuit should be dropped, according to papers filed in
court by McGuire late last week.
McGuire says he did not know that the options, which were backdated
to times when the stock price was lower to maximize gains, were
incorrectly recorded in company books.
That omission ultimately caused a $1.56 billion downward restatement of earnings going back 12 years.
"Is there sufficient evidence that Dr. McGuire knew that
UnitedHealth's accounting for and disclosures regarding the stock
option grants were wrong? The answer -- after nearly 60 depositions and
millions of pages of document production -- is no," McGuire's lawyers
say in a brief.
"Dr. McGuire has no formal training or degrees in finance,
accounting or law," the brief states. "His only professional training
is as a medical doctor with a specialty in pulmonology."
The filing is in support of a summary judgment motion by
UnitedHealth to toss out a shareholders lawsuit even before the trial
begins. Those are among the first comments McGuire has offered in
defense of the backdating activity.
Since the controversy surfaced in 2006, McGuire has been the face of stock option backdating at Minnetonka-based UnitedHealth.
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Featured comment
Dr. McGuire And UNH's Lawyers Think We Are All Idiots
Dr.
McGuire's argument that he did not know what he was doing was wrong is
ludicrous. For him to state that he did not understand that what … read more
he was doing amounts to theft is disengenuous and is demonstrative of
his arrogance. I take it that he had problems adding and subtracting,
as did the company's auditors, it lawyers and board. Those who received
options should return them as they were not earned. The lawyers and
auditors should be investigated and refund their fees which were not
earned given the quality of work. Finally, crooks belong in prison.
Where are the indictments? Sounds like stupidity will be Dr. McGuire's
defense.