The facts. An assisted living facility partnered with a preferred pharmacy to offset software costs related to the tracking and delivery of residents’ prescription medications. The facility charged residents an extra $10 each month if they did not choose the preferred pharmacy. The lower court held that the arrangement violated the Idaho Residential Care or Assisted Living Act, which guarantees residents the “right to select the pharmacy or pharmacist of their choice.” The facility appealed.

The issues. Two issues were on appeal: (1) whether the Idaho Residential Care or Assisted Living Act prohibits the facility from charging residents $10 more per month if they did not select the preferred pharmacy, and (2) whether either party could recover attorney’s fees.

The result. In a unanimous decision, the Court held that the $10 per month surcharge violated the “plan and unambiguous” text of the Idaho Residential Care or Assisted Living Act. As for attorney’s fees, the Court considered the request for fees under Idaho Code § 12-117(1) because the case involved “as adverse parties a state agency or a political subdivision and a person.” Under that statute, the Court must award attorney’s fees if it finds “that the nonprevailing party acted without a reasonable basis in fact or law.” The Idaho Department of Health and Welfare cited Rangen, Inc. v. Idaho Department of Water Resources, 159 Idaho 798 (2016), to argue that it was entitled to fees because the facility relied on the same arguments asserted below without adding new or persuasive authority. The Court declined to award fees, holding that after the Department filed its brief, the Court abrogated the Rangen standard in 3G AG LLC v. Idaho Department of Water Resources, 170 Idaho 251 (2022).

Practice Pointers.

1. If your client is adverse to a state agency or political subdivision, don’t forget about attorney’s fees. The prevailing party is entitled to fees if the nonprevailing party acts without a reasonable basis in fact or law, which presents either an additional benefit or risk. 
2. Stick by your guns if you think you have a reasonable argument that the trial court rejected. After 3G AG LLC v. Idaho Department of Water Resources, 170 Idaho 251 (2022), an appellant does not act unreasonably under Idaho Code § 12-117 simply because it repeats on appeal a reasonable argument that was rejected below.