Robbins Geller Rudman & Dowd LLP Files Class Action Suit against Merge Healthcare, Incorporated

Robbins Geller Rudman & Dowd LLP (“Robbins Geller”) (http://www.rgrdlaw.com/cases/mergehealthcare/) today announced that a class action has been commenced in the United States District Court for the Northern District of Illinois on behalf of purchasers of Merge Healthcare Incorporated (“Merge Healthcare” or the “Company”) (NASDAQ:MRGE) common stock during the period between August 1, 2012 and January 7, 2014 (the “Class Period”).

If you wish to serve as lead plaintiff, you must move the Court no later than 60 days from today. If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact plaintiff’s counsel, Samuel H. Rudman or David A. Rosenfeld 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/mergehealthcare/. 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 Merge Healthcare and certain of its officers and directors with violations of the Securities Exchange Act of 1934. Merge Healthcare is a Chicago, Illinois-based company that offers health stations, clinical trial software and other health data and analytics services.

The complaint alleges that during the Class Period, Merge Healthcare issued materially false and misleading statements regarding the Company’s financial performance and future business prospects. Specifically, the complaint alleges that defendants misrepresented or failed to disclose that both the existence and value of millions of dollars of the Company’s eClinical customer contracts had been falsified, and as a result the Company’s reported subscription backlog was overstated during the six quarters ended September 30, 2013, and that the Company was experiencing a continued reluctance amongst large health systems to move forward with enterprise imaging purchases.

After a series of Company disclosures starting in May 2013 regarding the sudden resignation of the Company’s General Counsel and later its Chairman and CEO, and the release of “very disappointing” second quarter 2013 earnings results, including a 9% decline year-over-year in revenue to $57.2 million despite reporting an 82% increase in its subscription backlog from the second quarter of 2012, and earnings per share and revenue that fell well short of what the market had been led to expect, the price of Merge Healthcare stock plummeted more than $2 per share, or more than 45%. Then, on January 8, 2014, before the open of trading, Merge Healthcare announced that the existence and/or value of millions of dollars of customer contracts had been falsified for six quarters ending September 30, 2013, in what it characterized as a rogue employee’s attempt to reach sales quotas and garner additional commissions. On this news, the price of Merge Healthcare stock, which had traded as high as $4.71 per share during the Class Period, fell to a closing price of $2.31 per share on January 8, 2014.

Plaintiff seeks to recover damages on behalf of all purchasers of Merge Healthcare 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 represents U.S. and international institutional investors in contingency-based securities and corporate litigation. With nearly 200 lawyers in ten offices, the firm represents hundreds of public and multi-employer pension funds with combined assets under management in excess of $2 trillion. The firm has obtained many of the largest recoveries and has been ranked number one in the number of shareholder class action recoveries in MSCI’s Top SCAS 50 every year since 2003. Please visit http://www.rgrdlaw.com for more information.