(UPDATED, 12:52 p.m., with comments from Labrador’s office.)

The stage is set for a legal battle pitting the State Board of Education against Attorney General Raúl Labrador.

Voting unanimously Friday morning, the board stood behind its decision to hold three closed-door executive sessions to discuss the University of Idaho’s plans to purchase the University of Phoenix. Labrador sued the board last month, saying the sessions violated Idaho’s open meeting law.

Board members entered Friday with two options: declare a do-over, or dig in.

They could have voted to revisit their May 18 decision to give the $685 million Phoenix purchase the go-ahead — “curing” actions stemming from their three executive sessions.

Instead, the board pushed back against a central point of Labrador’s lawsuit. Labrador is challenging the State Board’s decision to meet behind closed doors and cite an exemption in open meetings law, which allows transactions that could pit the state against competitors from other states or nations. Labrador has questioned whether the U of I was competing against any other suitors for Phoenix, a troubled, for-profit online university that serves some 85,000 adult students.

After Friday’s unanimous vote, State Board President Linda Clark read a brief prepared statement. “The attorneys engaged in this transaction determined that the exemption applied. Even now, with the benefit of hindsight analysis, we believe the exemption applies; therefore, no violation occurred, and no cure is necessary.”

In a statement Friday, Labrador’s office said board members “neglected their duties and continued down a path of wasting taxpayer funds and resources.”

While the looming legal battle escalated Friday, it did so quietly.

Before Friday’s public meeting, State Board members discussed their previous executive sessions, and Labrador’s lawsuit, in another executive session. After more than 30 minutes behind closed doors, the board spent only two minutes in open session. Without any discussion, the board upheld its previous actions.

Afterward, Clark declined to comment.

If the lawsuit does proceed, taxpayers could wind up paying two sets of attorneys. Last week, State Board executive director Matt Freeman said the board would need to hire an outside attorney to defend itself against Labrador’s office — and Freeman said the board would forward its legal bills to Labrador.

A question of competition

The legal battle could center on timing, and the question of competition.

When the U of I first began pursuing the Phoenix purchase in March, and when the State Board held its first executive session on the topic, the University of Arkansas was actively considering the purchase as well. But on April 24, the University of Arkansas regents voted against pursuing a Phoenix purchase.

The State Board then held two subsequent executive sessions to discuss the Phoenix acquisition, on April 25 and May 15 — again citing the competitive nature of the negotiations.

During a June 16 legislative hearing, U of I President C. Scott Green said he had heard “rumors” of two other potential Phoenix suitors. Freeman confirmed that two other states were in the running.

However, neither the U of I nor the State Board have elaborated on these remarks.

On June 20, four days after the legislative hearing, Labrador filed his lawsuit.

Labrador’s response

Labrador’s office issued a statement early Friday afternoon. Here it is, in full:

“Today, (the State Board) had an opportunity to simply cure a mistake and make a clear commitment to transparent governance. Instead, the board neglected their duties and continued down a path of wasting taxpayer funds and resources to justify its failure to follow Idaho Open Public Meeting laws all to keep a half-billion dollar transaction from public discourse. The people of Idaho should be given an opportunity to evaluate such a significant financial decision.

“As stated by A.G. Labrador previously, Idaho’s open meetings statute entrusts the attorney general to vindicate the people’s interest in transparent government. Every elected Idaho official should want public affairs to be conducted in full view of the public and consistent with the law. The people of Idaho deserve nothing less. This shouldn’t be controversial.”