## Facts

- UnitedHealth Group Inc. issued $850 million in 5.800% senior notes due March 15, 2036 under an indenture whose trustee was later succeeded by Wilmington Trust Company, acting solely as indenture trustee for noteholders.
- The indenture contained a reporting covenant requiring UnitedHealth to deliver to the trustee copies of reports and other information UnitedHealth is required to file with the SEC under Exchange Act § 13 or § 15(d).
- In 2006, amid an internal investigation regarding employee stock-option backdating, UnitedHealth did not timely file its second-quarter 2006 Form 10-Q.
- UnitedHealth filed a Form 12b-25 (late-filing notification) that included a substantial appendix with financial information similar to what would have been contained in the Form 10-Q.
- UnitedHealth continued making interest payments on the notes, and the notes remained investment grade during the reporting delay.
- UnitedHealth later filed the delayed SEC reports after completing the internal review.
- Wilmington Trust asserted that the untimely SEC filings breached the indenture reporting covenant, violated Trust Indenture Act (TIA) § 314(a)(1), and breached the implied covenant of good faith and fair dealing, thereby creating an event of default.
- UnitedHealth sought declaratory relief; the district court granted summary judgment for UnitedHealth on UnitedHealth’s claim and on Wilmington Trust’s counterclaims; Wilmington Trust appealed.

## Issues

1. Whether UnitedHealth’s late SEC filings breached the indenture’s reporting covenant and constituted an event of default.
2. Whether late SEC filings violated TIA § 314(a)(1) by failing to provide the trustee reports “required to be filed” under Exchange Act § 13 or § 15(d).
3. Whether the reporting delay and related disclosures breached the implied covenant of good faith and fair dealing.

## Decision

- The Eighth Circuit affirmed summary judgment for UnitedHealth.
- The court held the indenture’s reporting covenant required delivery of copies of required SEC reports, but did not impose an independent contractual requirement that UnitedHealth file those reports on time with the SEC.
- The court held TIA § 314(a)(1) similarly did not create a separate timeliness obligation beyond the Exchange Act reporting regime referenced in the statute.
- The court held the implied covenant of good faith and fair dealing was not breached because the record did not show bad faith or conduct depriving noteholders of the contract’s benefit.
- Because there was no breach of the indenture, no TIA violation, and no implied-covenant breach, there was no event of default and no default-based remedies such as acceleration.

## Legal Principles

- In a corporate indenture, a reporting covenant that requires delivery of reports “required to be filed” under Exchange Act § 13 or § 15(d) does not, without clear language, create an independent contractual duty to make timely SEC filings.
- Courts will not treat a late SEC filing as an event of default absent express indenture language making timeliness a default-triggering condition.
- TIA § 314(a)(1)’s cross-reference to Exchange Act reporting does not, by itself, supply a separate statutory timeliness requirement enforceable by the trustee based solely on lateness.
- The implied covenant of good faith and fair dealing cannot be used to add material terms the parties did not include, such as converting an incorporative reporting covenant into a strict timeliness obligation, absent proof of bad faith or deprivation of contract benefits.

## Conclusion

The Eighth Circuit held that UnitedHealth’s delayed SEC filings, made during an internal investigation and accompanied by interim disclosure, did not breach the indenture reporting covenant, violate TIA § 314(a)(1), or breach the implied covenant of good faith and fair dealing; therefore, no event of default occurred.


UnitedHealth Grp., Inc. v. Wilmington Tr. Co., 548 F.3d 1124 (8th Cir. 2008)