Robbins Geller Rudman & Dowd LLP Files Class Action Suit Against eHealth, Inc.

Robbins Geller Rudman & Dowd LLP (“Robbins Geller”) (http://www.rgrdlaw.com/cases/ehealth/) today announced that a class action has been commenced on behalf of an institutional investor in the United States District Court for the Northern District of California on behalf of purchasers of eHealth, Inc. (“eHealth”) (NASDAQ:EHTH) common stock during the period between June 5, 2014 and January 14, 2015 (the “Class Period”).

If you wish to serve as lead plaintiff, you must move the Court no later than 60 days from January 26, 2015. If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact plaintiff’s counsel, Darren Robbins of Robbins Geller at 800/449-4900 or 619/231-1058, or via e-mail at djr@rgrdlaw.com. If you are a member of this class, you can view a copy of the complaint as filed or join this class action online at http://www.rgrdlaw.com/cases/ehealth/. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member.

The complaint charges eHealth and certain of its officers and directors with violations of the Securities Exchange Act of 1934. eHealth offers Internet-based health insurance agency services for individuals, families and small businesses in the United States, as well as technology licensing and Internet advertising services.

The complaint alleges that during the Class Period, defendants issued materially false and misleading statements regarding the Company’s operations, finances and ability to meet financial targets. Specifically, the Company failed to disclose that its revenues had been adversely impacted by a rise in the number of approved insurance applicants who failed to make their plan payments, which reduced the amount of commission payments received by the Company. The Company also failed to disclose that execution failures and decreasing market share had compromised its ability to attract and retain paying Individual & Family Plan (“IFP”) members and to meet its 2014 guidance. As a result of defendants’ false statements, eHealth common stock traded at artificially inflated prices during the Class Period, reaching a high price of $39.16 per share on June 9, 2014.

On July 30, 2014, the Company announced its second quarter 2014 financial results, reporting that an increase in non-payment by approved insurance applicants had negatively impacted revenue generation for the quarter and revising downward its fiscal year 2014 guidance. In addition, the Company reported a 78% drop in IFP applications as compared to the second quarter of 2013. As a result of this news, eHealth’s stock price dropped $10.95 per share to close at $20.70 per share on July 31, 2014, a one-day decline of nearly 35%.

Then, on January 14, 2015, the Company announced its preliminary fourth quarter and fiscal year 2014 financial results, reporting that it expected to post a loss of between $13.8 million to $16.3 million for the fourth quarter, and that it would fail to meet its revised 2014 guidance. A primary reason given for the poor financial performance was a more than 40% drop in the number of IFP applications. As a result of this news, eHealth’s stock price dropped $11.38 per share to close at $9.42 per share on January 15, 2015, a one-day decline of nearly 55% and a decline of 76% from its Class Period high.

Plaintiff seeks to recover damages on behalf of all purchasers of eHealth common stock during the Class Period (the “Class”). The plaintiff is represented by Robbins Geller, which has expertise in prosecuting investor class actions and extensive experience in actions involving financial fraud.

Robbins Geller, with 200 lawyers in ten offices, represents U.S. and international institutional investors in contingency-based securities and corporate litigation. The firm has obtained many of the largest securities class action recoveries in history, including the largest securities class action judgment. Please visit http://www.rgrdlaw.com for more information.