Rigrodsky & Long, P.A. Appointed as Co-Lead Counsel in Class Action on Behalf of NovaMed, Inc. Shareholders

Rigrodsky & Long, P.A. Appointed as Co-Lead Counsel in Class Action on Behalf of NovaMed, Inc. Shareholders

On March 4, 2011, the Honorable Vice Chancellor Donald F. Parsons of the Delaware Court of Chancery issued an Order appointing Rigrodsky & Long, P.A. as Co-Lead Counsel in In re NovaMed, Inc. Shareholders Litigation, Consol. C.A. No. 6151-VCP.

The class action was commenced on behalf of the public shareholders of NovaMed, Inc. (“NovaMed” or the “Company”) against NovaMed and its Board of Directors (the “Board” or “Individual Defendants”) to enjoin the transaction announced on January 21, 2011 (the “Transaction”), pursuant to which NovaMed was acquired by Surgery Center Holdings, Inc. (“Surgery Partners”) in a transaction valued at approximately $214 million, including the assumption or repayment of approximately $105 million of indebtedness.

The class action alleges that the Transaction was the product of a flawed process that resulted from the Board’s failure to maximize shareholder value and deprived NovaMed’s public shareholders of the ability to participate in the Company’s long-term prospects.  Moreover, as alleged in the class action, Surgery Partners and the Company knowingly aided and abetted the Individual Defendants’ breaches of fiduciary duty.  Plaintiffs’ sought to enjoin the Transaction or, alternatively, rescind the Transaction in the event the defendants were able to consummate it.

As a result of Co-Lead Counsel’s efforts, on March 8, 2011, NovaMed filed an Amended Preliminary Proxy Statement with the SEC which contained certain supplemental disclosures (the “Initial Supplemental Disclosures”).  Among other things, the Initial Supplemental Disclosures provided additional information regarding the sale process leading up to the Transaction and additional information regarding the various analyses performed by NovaMed’s financial advisor, William Blair & Company (“William Blair”), in arriving at its opinion as to the fairness, from a financial point of view, of the consideration offered to shareholders in the Transaction.

Thereafter, as a result of Co-Lead Counsel’s further negotiations with defendants, NovaMed issued another amendment to its Preliminary Proxy Statement wherein it made additional supplemental disclosures (the “Additional Supplemental Disclosures”).  The Additional Supplemental Disclosures included further information regarding the sale process leading up to the Transaction and further information regarding the various analyses performed by William Blair in arriving at its opinion regarding the fairness, from a financial point of view, of the consideration offered to shareholders in the Transaction.