LOS ANGELES–(BUSINESS WIRE)–$EHTH #classaction—The Law Offices of Frank R. Cruz announces that a class action lawsuit has been filed on behalf of persons and entities that purchased or otherwise acquired eHealth, Inc. (“eHealth” or the Company”) (NASDAQ: EHTH) securities between March 19, 2018 and April 7, 2020, inclusive (the “Class Period”). eHealth investors have until June 8, 2020 to file a lead plaintiff motion.
If you are a shareholder who suffered a loss, click here to participate.
On April 8, 2020, Muddy Waters Research published a report alleging, among other things, that eHealth misled investors regarding member churn and revenue recognition. The report stated that the Company’s “member churn . . . skyrocketed” and “that EHTH is pursuing low quality, lossmaking growth while its LTVs are based on lower churn, pre-growth cohorts.”
On this news, eHealth’s stock price fell $12.82, nearly 12%, to close at $103.20 per share on April 8, 2020, thereby injuring investors.
The complaint alleges that defendants throughout the Class Period made false and/or misleading statements and/or failed to disclose: (1) its highly aggressive accounting and modeling assumptions; (2) its skyrocketing rate of member churn, resulting from eHealth’s pursuit of low quality, lossmaking growth; (3) its reliance on direct response television advertising, which attracts an unprofitable, high churn enrollee; and (4) as a result of the foregoing, Defendants’ public statements were materially false and misleading at all relevant times.
Follow us for updates on Twitter: twitter.com/FRC_LAW.
If you purchased eHealth securities during the Class Period, you may move the Court no later than June 8, 2020 to ask the Court to appoint you as lead plaintiff. To be a member of the Class you need not take any action at this time; you may retain counsel of your choice or take no action and remain an absent member of the Class. If you purchased eHealth securities, have information or would like to learn more about these claims, or have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Frank R. Cruz, of The Law Offices of Frank R. Cruz, 1999 Avenue of the Stars, Suite 1100, Los Angeles, California 90067 at 310-914-5007, by email to [email protected], or visit our website at www.frankcruzlaw.com. If you inquire by email please include your mailing address, telephone number, and number of shares purchased.
This press release may be considered Attorney Advertising in some jurisdictions under the applicable law and ethical rules.