The Law Offices of Frank R. Cruz Announces Investigation of eHealth, Inc. (EHTH) on Behalf of Investors
The Law Offices of Frank R. Cruz Announces Investigation of eHealth, Inc. (EHTH) on Behalf of Investors
LOS ANGELES--(BUSINESS WIRE)--The Law Offices of Frank R. Cruz is investigating potential claims against the board of directors of eHealth, Inc. (“eHealth” or the “Company”) (NASDAQ: EHTH) concerning whether the board breached its fiduciary duties to shareholders.
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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, the Company’s stock price fell $27.37, or 21%, to close at $103.20 per share on April 8, 2020, thereby injuring investors.
Then on July 23, 2020, 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, the Company’s stock price fell $34.83, or 30%, to close at $79.17 per share on July 24, 2020, thereby injuring investors further.
Our investigation concerns whether the Company’s board of directors breached its fiduciary duties to shareholders and/or grossly mismanaged the Company in connection with the above alleged misconduct
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If you still hold eHealth shares purchased before December, 2020 and wish to discuss this matter with us, or have any questions concerning your rights and interests with regards to this matter, 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 info@frankcruzlaw.com, 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.
Contacts
The Law Offices of Frank R. Cruz, Los Angeles
Frank R. Cruz, 310-914-5007
fcruz@frankcruzlaw.com
www.frankcruzlaw.com
