January 21, 2022 16:31 ET
| Source: Kirby McInerney LLP

NEW YORK, Jan. 21, 2022 (GLOBE NEWSWIRE) -- The law firm of Kirby McInerney LLP announces that a class action lawsuit has been filed in the U.S. District Court for the Northern District of California on behalf of those who acquired eHealth, Inc. (“eHealth” or the “Company”) (NASDAQ: EHTH) securities from April 26, 2018 to July 23, 2020 inclusive (the “Class Period”). Investors have until March 18, 2022 to apply to the Court to be appointed as lead plaintiff in the lawsuit.

eHealth is a health insurance marketplace with a technology and service platform that provides consumer engagement, education, and health insurance enrollment solutions.

On April 8, 2020, Muddy Waters Capital published a report alleging that eHealth’s “highly aggressive accounting masks . . . a significantly unprofitable business,” “that the key driver of growth since 2018 has been [eHealth’s] reliance on Direct Response television advertising, which attracts an unprofitable, high churn enrollee,” and that eHealth’s “assumptions in its LTV model seem highly aggressive when compared to reality.” On this news, eHealth’s stock price declined by $13.70 per share, or approximately 11.7%, from $116.90 per share on April 7, 2020 to close at $103.20 per share on April 8, 2020.

Then, on July 23, 2020 after-market hours, eHealth announced its financial results for second quarter 2020 which confirmed substantive aspects of the “member churn” allegations contained in the Muddy Waters report. On this news, eHealth’s stock price declined by $34.83 per share, or approximately 30.6%, from $114.00 per share on July 23, 2020 to close at $79.17 per share on July 24, 2020.

The lawsuit alleges throughout the Class Period that eHealth Defendants misrepresented and/or failed to disclose to investors its highly aggressive accounting and modeling assumptions, and skyrocketing rate of member churn resulting from eHealth’s pursuit of low quality, lossmaking growth, and its reliance on direct response television advertising, which attracts an unprofitable, high churn enrollee.

If you purchased or otherwise acquired eHealth securities, have information, or would like to learn more about these claims, please contact Thomas W. Elrod of Kirby McInerney LLP at 212-371-6600, by email at investigations@kmllp.com​, or by filling out this contact form, to discuss your rights or interests with respect to these matters without any cost to you.

Kirby McInerney LLP is a New York-based plaintiffs’ law firm concentrating in securities, antitrust, whistleblower, and consumer litigation. The firm’s efforts on behalf of shareholders in securities litigation have resulted in recoveries totaling billions of dollars. Additional information about the firm can be found at Kirby McInerney LLP’s website: http://www.kmllp.com.

This press release may be considered Attorney Advertising in some jurisdictions under the applicable law and ethical rules.

Contacts
Kirby McInerney LLP
Thomas W. Elrod, Esq.
212-371-6600
https://www.kmllp.com
investigations@kmllp.com

Tags

Securities Fraud CLASS ACTION LAWSUITLEGAL Investor Class Action

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