State owes $930,000 in legal fees in broadband dispute

(UPDATED, 8:56 a.m., to correct District Judge Patrick Owen’s name.)

The state owes more than $930,000 in legal fees to the company that successfully sued to overturn the Idaho Education Network contract, a judge ruled last month.

Like most legal matters involving the scuttled high school broadband project, this issue remains in dispute. The state’s hired lawyers have appealed District Judge Patrick Owen’s June 30 ruling.

But Owen’s latest ruling could add to the state’s seemingly ever-growing bill for the Idaho Education Network fiasco. The state has already spent more than $625,000 in legal fees for its own outside legal counsel. And the two lead vendors on the project have filed at least $6 million in tort claims for back payments; they have legal standing to sue the state, but have not done so.

But Syringa Networks did sue the state, claiming it was unfairly cut out of work on the broadband project. Owen sided with Syringa, tossing out the $60 million network contract.

In the battle over legal fees, Owen again sided with Syringa — saying the company had prevailed in court.

“From the overall view, while Syringa lost a number of preliminary battles, in the end, Syringa won the war that mattered decisively, after a lengthy and expensive challenge to a state agency willing and able to devote significant resources defending its conduct,” Owen wrote in an April 20 ruling. “Syringa’s challenge effectively terminated a significant and long-term state initiative to design and implement Internet connectivity to all schools in Idaho.”

And that ruling, in turn, sparked a legal skirmish over what the state actually owes Syringa.

In court documents, Syringa argued for slightly more than $42,000 in fees incurred after February, when Owen issued his second and final ruling voiding the network contract. The $42,000 was said to cover the job of calculating the costs of waging a six-year legal struggle — a task that required 174.6 hours of staff time.

Merlyn Clark and Steve Schossberger, the state’s outside attorneys, dismissed Syringa’s $42,000 claim as “incredible.”

“The preparation of a request for costs and attorney fees is as much administrative as it is legal in nature,” Clark and Schossberger wrote in a May 1 filing. “Yet, Syringa’s attorneys (emphasis in original filing) found the opportunity to squeeze nearly 175 hours of attorney time into its preparation.”

Owen sided with the state — to a point. He pared Syringa’s $42,000 claim down to $20,000. But that’s a small sum compared to the costs incurred by Syringa’s attorneys in the legal maneuvering leading up to Owen’s February ruling to void the broadband contract. Owen pegged those fees at $910,593.17.

Gov. Otter1
Gov. Butch Otter

Through a spokesman, Gov. Butch Otter declined comment. The Department of Administration, the state agency that had been in charge of the broadband network, did not immediately respond to a request for comment.

But on Friday, Clark and Schossberger filed a notice of appeal in District Court. Among other issues, they challenge Owen’s contention that Syringa had prevailed in the case over the network contract.

This is just one of several recent appeals filed in the case, by the state and by network vendors Education Networks of America and Qwest Communications. All three parties have filed appeals with Owen — as well as appeals to take the dispute back to the Idaho Supreme Court.

While the legal maneuvering continues, a legislative committee will spend the summer reviewing Idaho’s options for providing broadband to schools and state agencies. The committee’s first meeting is scheduled for July 21.

More reading: When did Otter learn about the broadband budget crunch?