(UPDATED, 7:09 a.m., to correct the name of Labrador deputy attorney general Greg Woodard.)
It could be several months before a district judge rules on a lawsuit on the University of Idaho-University of Phoenix megadeal.
Or this judge could throw out the lawsuit entirely — at any time of his choosing.
A 90-minute court hearing left the high-profile lawsuit in play, but also in limbo. And the ongoing lawsuit, in turn, continues to cast a shadow over the U of I’s $685 million bid to buy Phoenix, a for-profit online giant.
A lawyer for the State Board of Education says the case could affect the U of I’s ability to finance the purchase — and could cause accreditors to balk at the deal. And the lawsuit might not just delay the purchase. If Attorney General Raúl Labrador ultimately prevails in court, his lawsuit could stymie the purchase, because it would void the State Board’s May 18 vote that gave the deal the go-ahead.
Against this backdrop, a Labrador deputy and the State Board’s attorneys argued the lawsuit in an Ada County courtroom Thursday afternoon. At its heart, Thursday’s arguments and June 20 lawsuit center on questions of transparency. Did the State Board violate the open meetings law this spring, when it discussed the Phoenix purchase in a series of three closed-door meetings? Or did the State Board properly cite an exemption in the law, which allows closed executive session to conduct “preliminary negotiations” when an Idaho public entity “is in competition with governing bodies in other states or nations.”
Deputy attorney general Greg Woodard offered up several arguments against the meetings. He said State Board members did not even know the reason for the executive sessions when they held their first closed-door meeting on March 22. He said the board did not try to find out if the U of I was really in competition with other public bidders — especially after University of Arkansas regents pulled out of the Phoenix sweepstakes on April 24. And he said the State Board failed to adequately post notice of its May 18 open meeting — the meeting that ultimately provided the U of I with the green light.
Much of Woodard’s oral argument centered on the competition question, and the State Board’s failure to press for details. “It is a critical point: What they knew, and how they applied that.”
Trudy Hanson Fouser, the State Board’s hired independent counsel, accused Labrador’s legal team of looking for a series of “gotcha” moments designed to keep their four-month-old lawsuit alive. The notice of the May 18 meeting — which was widely emailed, if not necessarily posted publicly — met the “spirit” of the open meeting law. And she said the board had reason to believe the U of I was in a potential bidding war, since other public universities are looking to enhance their online reach into rural communities.
“Everyone believed this was a competitive situation and they were reasonable in believing that,” Fouser said.
Ultimately, the State Board’s legal team didn’t get what it was looking for — a summary judgment that would have killed the lawsuit entirely.
Instead, District Judge Jason Scott took no action Thursday, and offered a rather cryptic glimpse into the future. He didn’t rule out a summary judgment, but he didn’t reject the idea out of hand. He said he might decide to take some of the arguments to trial — and said he would schedule any trial within three months of a ruling.
The delay continues what has has grown into a high-profile political fight between Labrador and Gov. Brad Little’s appointees on the State Board. Woodard briefly addressed the politics Thursday.
“This isn’t a grudge match,” he said, noting that Labrador is legally obligated to enforce open meetings law.
The U of I and Phoenix have said they hope to have the deal approved by early 2024. But several things stand in the way.
Two accrediting bodies — overseeing the U of I and Phoenix — each much approve the blessing.
Four Three Education, the U of I’s nonprofit arm, would need to secure financing for the purchase.
And as of Thursday, the open meetings lawsuit remains a variable.