A NightHawk investor filed a lawsuit in State Court on behalf of investors of NightHawk Radiology Holdings, Inc. (NASDAQ:NHWK) alleging breaches of fiduciary duties arising out of the attempt to sell NightHawk Radiology too cheaply to Virtual Radiologic.
According to the complaint the plaintiff alleges that the offer by Virtual Radiologic to take over NightHawk Radiology was “unfair and grossly inadequate”.

On Monday, September 27, 2010, NightHawk Radiology Announce Merger and Virtual Radiologic announced that they have entered into an agreement under which Virtual Radiologic will acquire all of the outstanding common stock of NightHawk Radiology Holdings, Inc. for $6.50 per share in cash. The transaction is valued at approximately $170 million. According to NightHawk Radiology Holdings, Inc its board of directors unanimously approved the agreement and the offer price represents a premium of 100% over NightHawk's last closing stock price of $3.25 per share.

At first sight the offer seems to represent a significant premium for NightHoawk stockholders, since shares of NightHawk Radiology Holdings, which traded before the announcement at $3.25 per share, almost double to $6.38 per share in response to the takeover news.

But NHWK shares were down from its current 52weekHigh of $7.50, traded as high as $9.30 per share during Sept.2008 and as high as over $20 per share in early 2008, and reached several months in 2007 over $25 per share. In addition NightHawk Radiology Holdings revenue increased from $92.17million in 2006 to $162.54million in 2009.

Thus the plaintiff seeks to block the takeover of NightHawk Radiology by Virtual Radiologic Corp under the current conditions.