Aetna and CEO Face Shareholder Lawsuit
NEW YORK ( MainStreet) A shareholder of Aetna, Inc. has filed a lawsuit against the healthcare giant, its chairman, CEO, and president Mark T. Bertolini, as well as its board of directors. The complaint alleges violations of the Securities Exchange Act of 1934. Specifically, the plaintiff alleges that Aetna sent out false and misleading proxy statements to shareholders in 2012 and 2013.
The plaintiff, Stephen W. Silberstein, is being represented by Melanie Sloan and Anne Weisman of the Citizens for Responsibility and Ethics (CREW), a Washington, D.C. nonpartisan, watchdog group. The action was filed December 10, 2013, in the United States District Court for the Southern District of New York.
"Aetna made millions of dollars in political contributions in the 2012 election cycle - that went unreported - to the American Action Network (AAN) and the U.S. Chamber of Commerce," Sloan said in a January 15 phone interview. "These donations helped finance political ads against Democratic members of the House and Senate who supported the Affordable Care Act."
"There is a pretrial conference scheduled for late February," said Melanie Sloan, who is also the executive director of CREW. "I expect depositions sometime this spring."
According to the complainants, money furnished by Aetna to the USCC, while purportedly for "voter education," was actually used to run negative ads in hotly contested congressional elections. CREW alleges the contribution to the AAN was not reported at all. According to the language in the complaint, AAN launched a $1.2 million campaign to repeal the Affordable Care Act. The announcement for this campaign was made by AAN in July 2012. CREW also claims that Aetna was not being forthright about the company's political activities. According to a release, Aetna's proxy statements "included inaccurate information and omitted material information about the company's political activities to persuade shareholders to oppose a proposal offered by the Service Employees International Union Master Trust (SEIU) in 2012 and another offered by the Unitarian Universalist Association of Congregations (UUAC) in 2013." The SEIU proposal was for more transparency in political contributions.
"Aetna pretends to be a model of corporate transparency, but in truth, shareholders have almost no idea which dark money groups the company is funding or how much it is contributing," said Melanie Sloan in a contemporaneously prepared statement. "Aetna tried to hide its nearly $8 million in contributions to the American Action Network and the Chamber of Commerce to influence the 2012 elections. Who knows where else Aetna has been funneling money?"
Aetna, for its part, denies these allegations. Spokesperson Cynthia Michener provided the company's last proxy statement, which explained its political contributions. Michener reiterated that the the money to the USCC was for educational campaigns - although when asked Michener did not specify who was being educated about what.