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IN THE SUPREME COURT OF THE STATE OF IDAHO 

REED J. TAYLOR, an individual,

 Plaintiff-Appellant,

v.

MICHAEL E. MC NICHOLS, an individual; 

CLEMENTS, BROWN & MC NICHOLS, 

P.A., an Idaho professional corporation; 

JANE DOES I-V, unknown individuals,

 Defendants-Respondents.

_______________________________________

REED J. TAYLOR, 

 Plaintiff-Appellant,

v.

GARY D. BABBITT, an individual, D. JOHN 

ASHBY, an individual; PATRICK V. 

COLLINS, an individual; RICHARD A. 

RILEY, an individual; HAWLEY, 

TROXELL, ENNIS & HAWLEY, LLP, an 

Idaho limited liability partnership; JANE 

DOES I-X, unknown individuals.

 Defendants-Respondents.

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Docket No. 36130

Lewiston, April 2010 

2010 Opinion No. 95

Filed: September 3, 2010

Stephen W. Kenyon, Clerk 

Docket No. 36131

Appeal from the District Court of the Second Judicial District, State of Idaho, Nez 

Perce County. Hon. Jeff M. Brudie, District Judge.

District court decision, affirmed.

Campbell, Bissell & Kirby and Michael S. Bissell, Spokane, for appellant. 

Roderick C. Bond argued.

Hepworth, Janis & Brody, Chtd., Boise, for respondents McNichols and 

Clements, Brown & McNichols, P.A. John J. Janis argued.

Elam & Burke, P.A., Boise, for respondents Babbit, Ashby, Collins Riley and 

Hawley, Troxell, Ennis & Hawley, LLP. Jeffrey A. Thomson argued.
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__________________________________

BURDICK, Justice

This case comes before this Court on appeal from the grant of two Idaho Rule of Civil 

Procedure 12(b)(6) motions to dismiss for failure to state a claim upon which relief may be 

granted. Appellant, Reed Taylor alleges that the district court erred in denying his motions to 

amend his complaints, and erred in failing to properly apply the applicable standards in granting 

the motions to dismiss under I.R.C.P. 12(b)(6). We affirm.

I. FACTUAL AND PROCEDURAL BACKGROUND

This case arises as a result of the separate case of Taylor v. AIA, et al., Nez Perce County 

Case No. CV07-00208 (Underlying Case), now awaiting hearing before this Court on appeal. In 

order to properly understand the claims being asserted here, certain aspects of the Underlying 

Case must be examined. The case at hand has been consolidated on appeal from two separate 

before the district court, case number CV-08-01763 and case number CV08-01765.

A. Underlying Case

On January 29, 2007, Reed Taylor (Reed) filed suit against AIA Services Corporation 

(AIAS), AIA Insurance, Inc. (AIAI)1, John Taylor, Connie Taylor, Bryan Freeman, and JoLee 

Duclos. AIAI is a business entity existing under the umbrella of AIAS. When the Underlying 

Case began John Taylor was the managing director of both corporations and his then wife, 

Connie Taylor, held a community property interest in the corporations. John Taylor, Freeman, 

and Duclos were board members of both corporations. After Reed filed suit in the Underlying 

Case, Michael McNichols, of the law firm Clements, Brown & McNichols, P.A. (CBM), was 

retained to represent AIAS, AIAI, and John Taylor.

While the lawsuit was still pending, Reed attempted to exercise management authority 

over the AIA Entities, and the court in the Underlying Case granted a temporary restraining order 

against Reed on February 27, 2007. On March 8, 2007, the court in the Underlying Case entered 

a preliminary injunction which prohibited Reed from attempting to act as a manager or board 

member of AIAI, or from harassing or interfering with the management of AIAI and AIAS.

On March 28, 2007, McNichols filed a motion to withdraw as counsel for AIAI and 

AIAS, which was granted on April 12, 2007. On May 7, 2007, a notice of appearance on behalf 

 

1 When referred to collectively, AIAS and AIAI will be referenced as the ―AIA Entities.‖
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of the AIA Entities was filed by Gary Babbitt and John Ashby, of the law firm Hawley Troxell 

Ennis & Hawley, LLP (HTEH).

B. Current Case

On August 18, 2008, after the Underlying Case had been through 21 months of motions 

and hearings – while numerous other motions were pending, and the trial date had been set, but 

after the district court had granted a Motion for Partial Summary Judgment in favor of Reed as to 

the AIA Entities being in default on a $6,000,000 promissory note issued to Reed – Reed filed 

the present actions against McNichols and CBM, who were continuing to serve as counsel for 

John Taylor (case no. CV08-01765 below), and against Babbit, Ashby, Patrick Collins, Richard 

Riley,2 HTEH, and other unspecified attorneys who worked for HTEH on its representation of 

the AIA Entities (case no. CV08-01763 below).3 Reed asserted claims against Respondents for: 

(1) aiding and abetting or assisting others in the commission of tortious acts in the Underlying 

Case; (2) conversion and misappropriation of the AIA Entities‘ corporate assets; (3) violations of 

Idaho‘s Consumer Protection Act, I.C. § 48-601 et seq.; and (4) professional negligence and/or 

breach of fiduciary duties. 

Respondents filed motions to dismiss pursuant to I.R.C.P. 12(b)(6), and oral argument 

was heard on these motions on October 16, 2008. On the same day Reed filed his motions for 

leave to amend his complaints, attaching his proposed amended complaints, and a hearing was 

held on these motions on December 4, 2008.

On December 23, 2008, the district court issued two opinions titled ―Opinion and Order 

on Defendant‘s Motion for Preliminary Injunction‖ (Opinions) granting Respondents‘ motions to 

dismiss and denying Reed‘s motions to amend his complaints. In reaching his decision the 

district court judge, who was also the judge in the Underlying Case, found that the arguments 

made by both Reed and Respondents incorporated events and actions that occurred in the 

Underlying Case and, therefore, took judicial notice of the Underlying Case in toto. The district 

court subsequently granted Respondents‘ requests for attorney fees.

Reed filed a notice of appeal with this Court on January 30, 2009, and the two cases were 

consolidated for appeal on February 18, 2009. In light of Spokane Structures, 148 Idaho 616, 

226 P.3d 1263 (2010), it was recognized that no final judgment had been issued by the district 

 

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Collins and Riley were also attorneys with HTEH.

3 All of the above mentioned attorneys and law firms shall be collectively referred to as ―Respondents‖.
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court and the case was remanded for entry of a final judgment on March 16, 2010. This Court 

received Judgments from the district court for both of the pre-consolidation cases on March 24, 

2010.

II. ISSUES ON APPEAL

1. Whether the district court applied I.R.C.P. 12(b)(6) correctly in ruling on Respondents‘ 

motions to dismiss.

a. Whether the litigation privilege should be adopted in Idaho and whether Reed‘s 

claims should have be dismissed accordingly.

b. Whether, in the alternative, Reed‘s complaints alleged sufficient facts to 

withstand a motion to dismiss.

2. Whether the district court abused its discretion in denying Reed‘s motions for leave to 

amend his complaints.

a. Whether Reed had standing to bring derivative claims against Respondents.

b. Whether Reed pled additional facts in his amended complaints that would have

altered the analysis as it applied to his original complaints.

3. Whether the district court abused its discretion in awarding Respondents attorney fees 

pursuant to I.C. §§ 12-121, 30-1-746, 48-608.

4. Whether Respondents are entitled to attorney fees on appeal.

III. STANDARD OF REVIEW

Our standard of review for a grant of dismissal under Idaho Rule of Civil Procedure 

12(b)(6) was concisely summarized by this Court in Losser v. Bradstreet:

When this Court reviews an order dismissing an action pursuant to I.R.C.P. 

12(b)(6), we apply the same standard of review we apply to a motion for 

summary judgment. After viewing all facts and inferences from the record in 

favor of the non-moving party, the Court will ask whether a claim for relief has 

been stated. The issue is not whether the plaintiff will ultimately prevail, but 

whether the party is entitled to offer evidence to support the claims.

145 Idaho 670, 672-73, 183 P.3d 758, 760-61 (2008) (internal citations and quotations omitted). 

In addition, ―[t]his Court reviews an appeal from an order of summary judgment de novo, and 

this Court‘s standard of review is the same as the standard used by the trial court in ruling on a 

motion for summary judgment.‖ Curlee v. Kootenai Cnty. Fire & Rescue, 148 Idaho 391, __, 

224 P.3d 458, 461 (2008). Ergo, a district court‘s dismissal of a complaint under I.R.C.P. 

12(b)(6) shall be reviewed de novo. 

This Court employs an abuse of discretion standard when reviewing a district court‘s 

denial of a motion to amend a complaint to add additional causes of action. Spur Prod. Corp. v.
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Stoel Rives LLP, 142 Idaho 41, 43, 122 P.3d 300, 302 (2005). When reviewing an exercise of 

discretion on the part of a district court, this Court considers: 

―(1) whether the court correctly perceived that the issue was one of discretion; (2) 

whether the court acted within the outer boundaries of its discretion and 

consistently with the legal standards applicable to the specific choices available to 

it; and (3) whether it reached its decision by an exercise of reason.‖

Id. (quoting Estate of Becker v. Callahan, 140 Idaho 522, 527, 96 P.3d 623, 628 (2004)).

IV. ANALYSIS

A. The district court erred in taking judicial notice of the Underlying Case when 

considering the 12(b)(6) motions.

Reed alleges that the district court did not apply the correct legal standard when 

considering Respondents‘ 12(b)(6) motions to dismiss. Specifically, Reed alleges that the 

district court erred in taking judicial notice of the Underlying Case, when it should have limited 

its review to the pleadings. 

Idaho Rule of Civil Procedure 12(b) states, inter alia:

If, on a motion asserting the defense numbered (6) to dismiss for failure of the 

pleading to state a claim upon which relief can be granted, matters outside the 

pleading are presented to and not excluded by the court, the motion shall be 

treated as one for summary judgment and disposed of as provided in Rule 56, and 

all parties shall be given reasonable opportunity to present all material made 

pertinent to such a motion by Rule 56. 

(Emphasis added). 

Respondents make two arguments why they believe the district court‘s 12(b)(6) ruling 

should stand. First, the district court was acting within its permitted discretion in taking judicial 

notice of the Underlying Case. Second, having requested that the district court take judicial 

notice of the Underlying Case, Reed is barred under the invited error doctrine from raising this as 

an error on appeal. These arguments shall be considered in turn.

1. The district court could not properly take judicial notice of the Underlying Case when 

ruling on 12(b)(6) motions to dismiss. 

―A 12(b)(6) motion looks only at the pleadings to determine whether a claim for relief 

has been stated.‖ Young v. City of Ketchum, 137 Idaho 102, 104, 44 P.3d 1157, 1159 (2002). In 

Hellickson v. Jenkins, the Idaho Court of Appeals discussed judicial notice in the context of a 

12(b)(6) motion to dismiss, stating that:

[t]he only facts which a court may properly consider on a motion to dismiss for 

failure to state a claim are those appearing in the complaint, supplemented by 
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such facts as the court may properly judicially notice. Cohen v. United States,

129 F.2d 733 (8th Cir. 1942). However, a trial court, in considering a Rule 

12(b)(6) motion to dismiss, has no right to hear evidence; and since judicial notice 

is merely a substitute for the conventional method of taking evidence to establish 

facts, the court has no right to take judicial notice of anything, with the possible 

exception of facts of common knowledge which controvert averments of the 

complaint. See Grand Opera Co. v. Twentieth Century-Fox Film Corp., 235 F.2d 

303 (7th Cir. 1956); Sears, Roebuck & Co. v. [Metro] Engravers, Ltd., 245 F.2d 

67 (9th Cir. 1956); Schwartz v. Commonwealth Land Title [Ins.] Co., 374 F.Supp. 

564 (E.D.Pa. 1974), supp. op. (E.D.Pa.) 384 F.Supp. 302. 

118 Idaho 273, 276, 796 P.2d 150, 153 (Ct. App. 1990) (emphasis in the original). See also 

Fleming v. Lind-Waldock & Co., 922 F.2d 20, 23 (1st Cir. 1990) (comparing a 12(b)(6) motion 

to a Rule 56 motion the Court and finding, ―[o]ne fundamental difference between the two 

motions lies in the scope of the court‘s consideration. The grounds for a Rule 12(b)(6) dismissal 

comprise only the pleadings and no more‖) (emphasis added).

In Hellickson, a magistrate judge took judicial notice of the proceedings in two other 

cases. 118 Idaho at 275, 796 P.2d at 152. The Court of Appeals found this to be in error, and 

remanded with instructions to either decide the 12(b)(6) Motion on the allegations contained in 

the complaint alone, or to convert the 12(b)(6) motion to a Rule 56 summary judgment 

proceeding and afford the parties reasonable opportunity to present materials pertinent to a 

motion for summary judgment. Id. at 278, 796 P.2d at 155.

CBM ignores the direct Idaho precedent in Hellickson entirely, instead citing to the U.S. 

Supreme Court case of Tellabs, Inc. v. Makor Issues & Rights, Ltd., which states: ―[C]ourts must 

consider the complaint in its entirety, as well as other sources courts ordinarily examine when 

ruling on Rule 12(b)(6) motions to dismiss, in particular, documents incorporated into the 

complaint by reference, and matters of which a court may take judicial notice. See 5B Wright & 

Miller § 1357 (3d ed.2004 and Supp.2007).‖ 551 U.S. 308, 322 (2007). Nothing in Tellabs is 

inconsistent with what is written in Hellickson. HTEH cites to Hellickson for the proposition 

that courts may take judicial notice when considering a 12(b)(6) motion, but does not address 

Hellickson as it specifically applies to the issue of taking judicial notice of the proceedings in 

other cases. The rule stated in Hellickson clearly applies here.

2. The doctrine of invited error does not preclude Reed from appealing the district 

court‘s erroneous decision to take judicial notice of the Underlying Case in toto.

―It has long been the law in Idaho that one may not successfully complain of errors one 

has acquiesced in or invited. Errors consented to, acquiesced in, or invited are not reversible.‖ 
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State v. Owsley, 105 Idaho 836, 838, 673 P.2d 436, 438 (1983) (internal citation omitted). 

―Invited error‖ is ―[a]n error that a party cannot complain of on appeal because the party, through 

conduct, encouraged or prompted the trial court to make the erroneous ruling.‖ Black‘s Law 

Dictionary 249 (3rd pocket ed. 2006). 

At the hearing on Respondents‘ 12(b)(6) motions, on October 10, 2008, Reed‘s attorney, 

Bissell, had the following exchange with the district court judge:

MR. BISSELL: Also, your Honor, I would - - I would ask the Court because we 

obviously - - we have talked about a lot of information in the past in this case and 

in the other cases and, you know, a lot of the information in the other cases kind 

of has an impact on this case. So I would ask the Court to take judicial notice of 

everything that’s been followed, argued in those previous cases - - or in the other 

matter, the underlying matter we might call it . . .

THE COURT: Well, that was actually my intention, Mr. Bissell, that‘s part of 

what I came to conclude is I really can‘t discuss this and rule on the pending 

Motion to Dismiss without the consideration of the underlying case, so that was 

actually my intention.

MR. BISSELL: Okay, thank you, your Honor.

Respondents aver that, under the doctrine of invited error as it is applied in cases such as 

State v. Owsley, 105 Idaho 836, 838, 673 P.2d 436, 438 (1983), and Woodburn v. Manco, 137 

Idaho 502, 505, 50 P.3d 997, 1000 (2002), Reed, having clearly requested that the district court 

take judicial notice of the Underlying Case, may not argue on appeal that this was in error. ―The 

purpose of the invited error doctrine is to prevent a party who caused or played an important role 

in prompting a trial court to [take a certain action] from later challenging that [action] on 

appeal.‖ Woodburn, 137 Idaho at 505, 50 P.3d at 1000. Reed offers five reasons why he does 

not believe the doctrine of invited error should apply here, and these shall be addressed in turn.

First, Reed argues that ―it is irrelevant who requested judicial notice‖, as the district court 

erred in failing to convert the motions to dismiss into motions for summary judgment when 

considering evidence beyond the pleadings, in accordance with Hellikson, 118 Idaho at 276, 796 

P.2d at 153. Reed offers no citation for this proposition, and it conflicts with the policy 

underlying the invited error doctrine. The invited error doctrine presumes that the trial court 

acted in error, otherwise there would be no reversible error in any event. The invited error 

doctrine provides that where the error in question was encouraged or requested by a party then 

that party is precluded from challenging on the basis of that error on appeal. Contrary to Reed‘s 
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contention, the issue of which party requested the court to take that action — such action 

constituting error — is of great importance.

Second, Reed contends that the invited error doctrine does not apply because the district 

court had already intended to take judicial notice, based upon the district judge‘s response to 

Reed‘s counsel‘s request that the judge take judicial notice, that ―that was actually my intention.‖ 

Again, Reed offers no citation to any legal authority in support of this argument. This Court in 

Owsley wrote, ―Errors consented to, acquiesced in, or invited are not reversible.‖ 105 Idaho at 

838, 673 P.2d at 438. It is clear here that Reed consented to the district court‘s taking judicial 

notice, as well as acquiescing to it and inviting it. This argument is without merit.

Third, Reed contends that the invited error doctrine does not apply because Reed‘s 

counsel was not tactically or strategically requesting judicial notice. Reed cites to no Idaho law 

in support of this contention, instead citing to People v. Guerrero, 66 Cal. Rptr. 3d 701 (Cal. Ct. 

App. 2007), and Keller v. Columbus, 797 N.E.2d 964, (Ohio 2003). 

The only relevance to this issue presented in Guerrero is a footnote citing to People v.

Coffman, 96 P.3d 30 (Cal. 2004). 66 Cal. Rptr. 3d at 703 n.3. In Coffman the Supreme Court of 

California writes:

As articulated in People v. Wickersham [650 P.2d 311 (Cal. 1982)], disapproved 

on other grounds in People v. Barton [906 P.2d 531 (Cal. 1995)]: ―The doctrine 

of invited error is designed to prevent an accused from gaining a reversal on 

appeal because of an error made by the trial court at his behest. If defense 

counsel intentionally caused the trial court to err, the appellant cannot be heard to 

complain on appeal. . . . [I]t also must be clear that counsel acted for tactical 

reasons and not out of ignorance or mistake.‖ In cases involving an action 

affirmatively taken by defense counsel, we have found a clearly implied tactical 

purpose to be sufficient to invoke the invited error rule.

96 P.3d at 49 (emphasis added) (ellipses and third alteration in the original). It is unnecessary to 

consider whether California‘s articulation on this issue is persuasive to Idaho, because even 

under this analysis Reed‘s argument fails. Reed affirmatively acted in requesting the trial court 

to take judicial notice of the Underlying Case, for the purpose of having the district court 

consider the Underlying Case, a clearly implied tactical purpose.

In the other case Reed relies on – Keller – the Supreme Court of Ohio examined a 

12(b)(6) dismissal, which had been granted by the district court and reversed by the Court of 

Appeals, on the basis that the district court had considered evidence beyond the pleadings. The 

Appellants (Defendants) argued that because the Respondents (Plaintiffs) had attached evidence 
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to their pleading, Respondents were barred under the invited error doctrine from arguing that the 

district court erred in considering information beyond the pleadings. Keller, 797 N.E.2d at 969. 

The Court found that, under the facts of Keller, the record showed that Defendants had attached 

evidence to their own pleading first, that it was in response to this that the Plaintiffs had attached 

evidence to their own pleading, and that, therefore, the invited error doctrine did not apply. Id. at 

969-70. Whatever persuasive authority Keller might offer to Idaho courts, it has no applicability 

here as neither Reed nor Respondents attached evidence to their pleadings. Further, even if the 

rule to be extrapolated from Keller is that a party may not be barred under the invited error 

doctrine where the other party invites that error first (a dubious proposition), there is no 

allegation that Respondents requested that the district court take judicial notice of the Underlying 

Case.

Fourth and fifth, Reed argues that the district court erred in taking judicial notice of the 

Underlying Case in toto without complying with I.R.E. 201. Specifically, Reed alleges that the 

district court acted in violation of I.R.E. 201(c) & (d). Idaho Rule of Evidence 201(c) outlines 

the rules for judicial notice where the court has discretion as to whether or not to take judicial 

notice, and I.R.E. 201(d) is for mandatory notice. I.R.E. 201(c) reads: ―When discretionary. A 

court may take judicial notice, whether requested or not. When a court takes judicial notice of 

records, exhibits, or transcripts from the court file in the same or a separate case, the court shall 

identify the specific documents or items that were so noticed.‖ I.R.E. 201(d) reads: 

―When mandatory. When a party makes an oral or written request that a court 

take judicial notice of records, exhibits or transcripts from the court file in the 

same or a separate case, the party shall identify the specific documents or items 

for which the judicial notice is requested or shall proffer to the court and serve on 

all parties copies of such documents or items. A court shall take judicial notice if 

requested by a party and supplied with the necessary information.‖

Reed alleges that, as Reed‘s counsel did not supply the court with the necessary 

information to take judicial notice under I.R.E. 201(d), the court erred and invited error is 

inapplicable. Reed‘s argument concerning I.R.E. 201(d) is invalid; all this alleges is that the 

district court erred in taking judicial notice, not that this error was not invited by Reed‘s counsel. 

Reed‘s counsel failed to specify which materials from the Underlying Case he was requesting the 

court to take notice of, implicitly inviting the court to use its own discretion. Reed is barred from 

alleging an I.R.E. 201(d) violation under the invited error doctrine. Where an attorney is 

requesting that a court take judicial notice of a document or items, that attorney must state with 
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particularity what he is asking the Court to take notice of. Where an attorney does not meet this 

requirement it is improper for a court to take judicial notice under I.R.E. 201(d). Furthermore, 

where it was erroneous for the district court to take judicial notice it certainly cannot be said that 

such notice was mandatory; therefore I.R.E. 201(d) is inapplicable.

Reed further alleges that, if I.R.E. 201(c) applies, the district court erred in not 

identifying the specific documents and files that it took judicial notice of, an error which may not 

be attributed to invited error as Reed neither asked nor encouraged the district court to take 

judicial notice under I.R.E. 201(c) in toto, without specifying which documents and exhibits it 

was taking notice of. This argument has merit. The court clearly failed to comply with the 

specificity requirement of I.R.E. 201(c). Reed invited the court to take judicial notice, and the 

I.R.E. 201(c) error clearly occurred as a result of that invited error, but that violation cannot 

fairly be attributed to the error invited. The court could have erroneously taken judicial notice of 

parts of the Underlying Case, as requested and encouraged by Reed, and still followed I.R.E. 

201(c) by identifying the particular evidence from the Underlying Case which it took notice of. 

The district court erred in taking judicial notice of the Underlying Case, and though Reed 

is generally precluded from raising this issue on appeal under the invited error doctrine, the 

district court erred beyond what was invited by Reed in failing to comply with the specificity 

requirements of I.R.E. 201(c). 

In spite of the district court‘s error, this error is harmless under I.R.C.P. 61. See Banning 

v. Minidoka Irrigation Dist., 89 Idaho 506, 510, 406 P.2d 802, 803 (1965). This Court applies a 

de novo standard of review to appeal from grants of 12(b)(6) motions, and shall look only to the 

pleadings without consideration to the record from the Underlying Case.4 Therefore, we shall 

consider the pleadings in this case under the standards applicable to a 12(b)(6) proceeding.

B. The Litigation Privilege

The district judge‘s Opinions – granting Respondents‘ motions to dismiss and denying 

Reed‘s motions for leave to amend his complaints – relied strongly on the so-called ―litigation 

privilege,‖ or ―litigation immunity.‖ 

 

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Even if the Court were inclined to consider the same materials that the district court judge erroneously considered 

from the Underlying Case it could not, as the district court failed to identify the specific materials that it considered 

in reaching its ruling.
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The litigation privilege is deeply rooted in the common law doctrine that attorneys are 

immune from civil suits for defamation or libel when they arise out of communications made in 

the course of judicial proceedings. In fact, ―[a]t common law, the litigation privilege blanketed 

all participants in the court system; private attorneys were treated no differently than judges, 

government lawyers, and witnesses.‖ Loigman v. Twp. Comm. of Middleton, 889 A.2d 426, 433, 

435 (N.J. 2006) (discussing, e.g., Cutler v. Dixon, 76 Eng. Rep. 886 (K.B. 1585); Hodgson v.

Scarlett, 171 Eng.Rep. 362 (C.P. 1817); Hoar v. Wood, 44 Mass. 193 (1841)). See also 

Carpenter v. Grimes Pass Placer Mining Co., 19 Idaho 384, 114 P. 42 (1911) (first application 

of what may be termed the ―defamation privilege‖ in Idaho, discussing the common law 

privilege and its application across American jurisdictions; noting that American Courts, unlike 

English Courts, generally require that communications must be pertinent and material to the 

matter before the judicial proceeding in order for the privilege to apply.) This privilege is 

predicated on the long-established principle that the efficient pursuit of justice requires that 

attorneys and litigants must be permitted to speak and write freely in the course of litigation 

without the fear of reprisal through a civil suit for defamation or libel. Loigman, 889 A.2d at 

434.

Examining the two most recent cases where Idaho has applied this privilege (as it applies 

to attorneys) sheds some further light on the application of this privilege under Idaho law. In 

Richeson v. Kessler, an attorney, Richeson, was acting as counsel for the Andersons. 73 Idaho

548, 550, 255 P.2d 707, 707 (1953). Another attorney, Kessler, applied with the district court to 

appear amicus curiae. Id. Richeson objected to this application to appear amicus curiae in his 

brief to the court. Id. The Andersons subsequently dismissed Richeson and retained Kessler. Id. 

When Kessler learned of Richeson‘s brief objecting to Kessler‘s application he wrote a letter to 

the district judge asking that the judge withdraw the brief from consideration, specifically 

alleging that portions of said brief had been ―malicious, scurrilous, and definitely improper and 

unethical.‖ Id. Richeson subsequently filed suit against Kessler, alleging that the letter was 

libelous. Id.

The Richeson Court held that ―[w]ith certain exceptions, unimportant here, defamatory 

matter published in the due course of a judicial proceeding, having some reasonable relation to 

the cause, is absolutely privileged and will not support a civil action for defamation although 
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made maliciously and with knowledge of its falsity.‖ 73 Idaho at 551-52, 255 P.2d at 709. In 

addition, this Court specified that:

The term judicial proceeding is not restricted to trials, but includes every 

proceeding of a judicial nature before a court or official clothed with judicial or 

quasi judicial power, 53 C.J.S., Libel and Slander, § 104, page 169, and to be 

privileged it is not absolutely essential that the language be spoken in open court 

or contained in a pleading, brief or affidavit.

Id. at 551, 255 P.2d at 709.

More recently, in 1993, the Idaho Court of Appeals applied the privilege in Malmin v.

Engler, wherein the court noted that this privilege ― ̳is based upon a public policy of securing to 

attorneys and officers of the court the utmost freedom in their efforts to secure justice for their 

clients.‘‖ 124 Idaho 733, 735, 864 P.2d 179, 181 (Ct. App. 1993) (quoting Restatement (Second) 

of Torts § 586 cmt. a (1965)). The court emphasized that statements made prior to, or in 

preparation of, a judicial proceeding are also protected under the privilege. Id. at 737, 864 P.2d 

at 184.

Idaho‘s Appellate Courts have never considered the propriety of expanding this privilege 

to encompass conduct, as well as statements, which occur during the course of litigation, nor 

whether the privilege should extend to causes of action beyond defamation and libel. We take 

this opportunity to do so.

1. Examination of the litigation privilege across various jurisdictions.

In Loigman v. Township Committee of Middleton, the Supreme Court of New Jersey 

noted that, although the litigation privilege was originally used only to protect against 

defamation suits arising from comments which were made in the course of judicial proceedings, 

the privilege has been widely expanded in order to address creative pleading. 889 A.2d 426, 435 

(N.J. 2006). Specifically, in noting that, ―[i]n New Jersey, the litigation privilege protects 

attorneys not only from defamation actions, but also from a host of other tort-related claims,‖ the 

Loigman Court cited to Rainier’s Dairies v. Raritan Valley Farms, 117 A.2d 889, 895 (N.J. 

1955). Id. at 436.

In Rainier, the Court was considering the protections which the litigation privilege 

provided to a litigant, rather than an attorney. However, as noted above, these privileges arose 

from the same public policies at common law, and the decision has been extended to the 

litigation privilege as it pertains to attorneys. The Rainier Court held that in addition to the 

traditional protection against suits for defamation, the litigation privilege also protected against 
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claims for malicious interference with business operations, reasoning that ―[i]f the policy, which 

in defamation actions affords an absolute privilege or immunity to statements made in judicial 

and quasi-judicial proceedings is really to mean anything then we must not permit its 

circumvention by affording an almost equally unrestricted action under a different label.‖ Id. at 

895.

The district court in the case at hand found that the Texas Court of Appeals case of Alpert 

v. Crain, Caton & James, P.C., 178 S.W.3d 398 (Tex. App. 2005), was particularly instructive, 

having many similarities to the present action. In Alpert, the Appellants had first sued their own 

attorney, Riley, and subsequently filed suit against the Respondent, the law firm representing 

Riley in that action, claiming that Respondent ―conspired with Riley to defraud [the Appellants], 

and both aided and abetted in the breach of, and tortiously interfered with, Riley‘s fiduciary duty 

to [the Appellants].‖ Id. at 402. The district court in Alpert had dismissed the case, finding that 

the Appellants had failed to plead a cause of action recognized by Texas law and, consequently, 

the Texas Court of Appeals heard the case on appeal in circumstances analogous to those 

presented in the present case. In affirming the dismissal by the district court, the Texas Court of 

Appeals explained that: 

Perhaps as an offshoot of its privity jurisprudence, Texas case law has 

discouraged lawsuits against an opposing counsel if the lawsuit is based on the 

fact that counsel represented an opposing party in a judicial proceeding. An 

attorney has a duty to zealously represent his clients within the bounds of the law. 

In fulfilling this duty, an attorney has the right to interpose defenses and pursue 

rights that he deems necessary and proper, without being subject to liability or 

damages. If an attorney could be held liable to an opposing party for statements 

made or actions taken in the course of representing his client, he would be forced 

constantly to balance his own potential exposure against his client‘s best interest. 

Such a conflict hampers the resolution of disputes through the court system and 

the attainment of justice. Thus, to promote zealous representation, courts have 

held that an attorney is “qualifiedly immune” from civil liability, with respect to 

non-clients, for actions taken in connection with representing a client in litigation.

This qualified immunity generally applies even if conduct is wrongful in 

the context of the underlying lawsuit. For example, a third party has no 

independent right of recovery against an attorney for filing motions in a lawsuit, 

even if frivolous or without merit, although such conduct is sanctionable or 

contemptible as enforced by the statutory or inherent powers of the court. Courts 

have refused to acknowledge an independent cause of action in such instances 

―because making motions is conduct an attorney engages in as part of the 

discharge of his duties in representing a party in a lawsuit.‖ [Bradt v. West, 392 

S.W.2d 56, 72 (Tex. App. Ct. 1994)] . . . Thus, an attorney‘s conduct, even if 
14

frivolous or without merit, is not independently actionable if the conduct is part of 

the discharge of the lawyer‘s duties in representing his or her client. The 

immunity focuses on the type of conduct, not on whether the conduct was 

meritorious in the context of the underlying lawsuit.

Id. at 405-06 (internal citations omitted) (emphases added).

In Clark v. Druckman, the Supreme Court of West Virginia considered, inter alia, the 

following question, certified to it by a district court:

Is a party to a civil action barred, by virtue of the litigation privilege, from 

bringing claims for civil damages against the opposing party‘s attorney if the 

alleged act of the attorney in the course of the attorney‘s representation of the 

opposing party is conduct and not a written or oral statement which arose in the 

civil action and which has some relationship to the civil action?

624 S.E.2d 864, 871 (W. Va. 2005). The Court answered this question in the affirmative, after 

considering the policy considerations underlying the litigation privilege, specifically: 

(1) promoting the candid, objective, and undistorted disclosure of evidence; (2) 

placing the burden of testing the evidence upon the litigants during trial; (3) 

avoiding the chilling effect resulting from the threat of subsequent litigation; (4) 

reinforcing the finality of judgments; (5) limiting collateral attacks upon 

judgments; (6) promoting zealous advocacy; (7) discouraging abusive litigation 

practices; and (8) encouraging settlement.

Id. at 870 (quoting Matsuura v. E.I. du Pont de Nemours & Co., 73 P.3d 687, 693 (Haw. 2003)). 

The Clark Court found that, in light of these policy considerations, ―we see no reason to 

distinguish between communications made during the litigation process and conduct occurring 

during the litigation process.‖ Id. (emphasis in the original). The Court noted that the Supreme 

Court of Florida had reached a similar conclusion, in holding that:

absolute immunity[5] must be afforded to any act occurring during the course of a 

judicial proceeding, regardless of whether the act involves a defamatory statement 

or other tortious behavior . . . , so long as the act has some relation to the 

proceeding. The rationale behind the immunity afforded to defamatory 

statements is equally applicable to other misconduct occurring during the course 

of a judicial proceeding. Just as participants in litigation must be free to engage in 

unhindered communication, so too must those participants be free to use their best 

 

5 The difference between an absolute privilege and a qualified privilege is that: 

the absolute privilege affords complete protection whereas the qualified privilege affords 

protection only if there is no ill motive or malice in fact. The most noteworthy illustration of the 

absolute privilege or immunity is that afforded in judicial proceedings where judges, attorneys, 

witnesses, parties and jurors are fully protected against defamation actions based on utterances 

made in the course of the judicial proceedings and having some relation thereto.

Rainier’s Dairies v. Raritan Valley Farms, 117 A.2d 889, 891-82 (N.J. 1955) (internal citations omitted).
15

judgment in prosecuting or defending a lawsuit without fear of having to defend 

their actions in a subsequent civil action for misconduct.

Id. (emphases added) (quoting Levin, Middlebrooks, Mabie, Thomas, Mayers & Mitchell, P.A. v.

U.S. Fire Ins. Co., 639 So.2d 606, 608 (Fla. 1994)). See also, Maness v. Star-Kist Foods, Inc., 7 

F.3d 704, 709 (8th Cir. 1993) (applying Minnesota law) (―[A]n attorney who acts within the 

scope of the attorney-client relationship will not be liable to third persons for actions arising out 

of his professional relationship unless the attorney exceeds the scope of his employment or acts 

for personal gain.‖); Reynolds v. Schrock, 142 P.3d 1062, 1069 (Or. 2006) (en banc) (―[F]or a 

third party to hold a lawyer liable for substantially assisting in a client‘s breach of fiduciary duty, 

the third party must prove that the lawyer acted outside the scope of the lawyer-client 

relationship.‖); Kahala Royal Corp. v. Goodsill Anderson Quinn & Stifel, LLP, 151 P.3d 732 

(Haw. 2007) (taking an exhaustive look at the litigation privilege in multiple jurisdictions, and 

concluding that public policy supports applying the privilege to conduct as well as 

communications). 

In line with the foregoing, we find that the litigation privilege shall be found to protect 

attorneys against civil actions which arise as a result of their conduct or communications in the 

representation of a client, related to a judicial proceeding. 

2. When the litigation privilege applies.

Reed correctly contends that the litigation privilege does not provide attorneys with 

blanket immunity against all claims raised against them, merely because they are acting as an 

attorney in litigation. However, where attorneys are being sued by the opponent of their client in 

a current or former lawsuit, and that suit arises out of the attorneys‘ legitimate representation of 

that client pursuant to that litigation, the privilege does apply.

The Supreme Court of West Virginia, in Clark v. Druckman, wrote:

In Collins [v. Red Roof Inns, Inc.,] we recognized that absolute privileges, 

such as the litigation privilege, should only be permitted in limited circumstances. 

[566 S.E.2d 595, 598 (W. Va. 2002)]. Thus, we do not believe that a litigation 

privilege should apply to bar liability of an attorney in all circumstances. In 

Mehaffy, Rider, Windholz & Wilson v. Central Bank Denver, N.A., 892 P.2d. 230, 

235 (Colo. 1995), the Colorado Supreme court noted that ―an attorney is not liable 

to a non-client absent a finding of fraud or malicious conduct by the attorney.‖ 

See also Baglini v. Lauletta, [768 A.2d 825, 833-34 (2001)] (―The one tort 

excepted from the reach of the litigation privilege is malicious prosecution, or 

malicious use of process.‖). We believe such exceptions to an absolute litigation 

privilege arising from conduct occurring during the litigation process are 
16

reasonable accommodations which preserve an attorney's duty of zealous 

advocacy while providing a deterrent to intentional conduct which is unrelated to 

legitimate litigation tactics and which harms an opposing party. As recently noted 

by a California court:

[a] fraud claim against a lawyer is no different from a fraud claim 

against anyone else. If an attorney commits actual fraud in his 

dealings with a third party, the fact he did so in the capacity of 

attorney for a client does not relieve him of liability. While an 

attorney's professional duty of care extends only to his own client 

and intended beneficiaries of his legal work, the limitations on 

liability for negligence do not apply to liability for fraud.

Vega v. Jones, Day, Reavis & Pogue, [17 Cal.Rptr.3d 26, 31-2] (Cal. Ct. App.

2004) (internal citations and quotations omitted). . . .

Where an attorney files suit without reasonable or probable cause with the 

intent to harm a defendant, we do not believe the litigation privilege should 

insulate him or her from liability for malicious prosecution.

624 S.E.2d at 870-71 (first emphasis in the original). See also Restatement (Third) of The Law 

Governing Lawyers § 57(2) (2000) 

(A lawyer representing a client in a civil proceeding or procuring the institution of 

criminal proceedings by a client is not liable to a nonclient for wrongful use of 

civil proceedings or for malicious prosecution if the lawyer has probable cause for 

acting, or if the lawyer acts primarily to help the client obtain a proper 

adjudication of the client‘s claim in that proceeding.)

In Kahala Royal Corp. v. Goodsill Anderson Quinn & Stifel, LLP, the Supreme Court of 

Hawai‘i took an extensive look at the litigation privilege, and how different jurisdictions have 

applied the privilege as it pertains to claims of tortious interference. 151 P.3d 732 (Haw. 2007). 

The Court noted that generally for a claim of tortious interference to be brought against an 

attorney, where such claim arises out of his performance as an attorney, it must be established 

that the attorney acted in a manner demonstrating personal malice or a desire to harm, not 

springing from his desire to protect his client. Id. at 750. (discussing Schott v. Glover, 440 

N.E.2d 376, 380 (Ill. App. Ct. 1982) (―A plaintiff can state a cause of action for tortious 

interference with a contract against a third party who is conditionally privileged if the plaintiff 

can set forth factual allegations from which actual malice may reasonably be said to exist.‖ 

(Emphasis added). However, these allegations ―would necessarily include a desire to harm, 

which is independent of and unrelated to the attorney’s desire to protect his client.‖) (Emphases 

added)). See also Fraidin v. Weitzman, 611 A.2d 1046, 1080 (Md. Ct. Spec. App. 1992) (―To 

remove the qualified privilege, the attorney must possess a desire to harm which is independent 
17

of the desire to protect his client. This would constitute actual malice and therefore substantiate 

a tortious interference with contract claim.‖) (emphases added) (holding that, where the 

Appellant failed to allege facts constituting actual malice on behalf of the attorney, a motion for 

summary judgment was appropriately granted); Macke Laundry Serv. Ltd. P’ship v. Jetz Serv.

Co., 931 S.W.2d 166, 182 (Mo. Ct. App. 1996) (―This court recognizes a privilege for attorneys, 

when acting within the scope of the attorney-client relationship, to advise and act for a client 

even though that advice, if wrong, may cause a client to tortiously interfere with another‘s 

business relationship or expectancy, so long as the attorney does not employ wrongful means and 

acts with good faith to protect the interests of the client and not for the attorney‘s self interest.‖); 

Restatement (Third) of The Law Governing Lawyers § 57(3) (2000) (―A lawyer who advises or 

assists a client to make or break a contract, to enter or dissolve a legal relationship, or to enter or 

not enter a contractual relation, is not liable to a nonclient for interference with contract or with 

prospective contractual relations or with a legal relationship, if the lawyer acts to advance the 

client‘s objectives without using wrongful means.‖).

Application of the litigation privilege varies across jurisdictions, but the common thread 

found throughout is the idea that an attorney acting within the law, in a legitimate effort to 

zealously advance the interests of his client, shall be protected from civil claims arising due to 

that zealous representation. An attorney engaging in malicious prosecution, which is necessarily 

pursued in bad faith, is not acting in a manner reasonably calculated to advance his client‘s 

interests, and an attorney engaging in fraud is likewise acting in a manner foreign to his duties as 

an attorney. If an attorney engages in tortious interference with a third-party‘s interest out of a 

personal desire to harm, separate entirely from his desire to advance his client‘s interests, that 

attorney‘s conduct is not properly adjudged as occurring in the course of his representation of his 

client‘s interests. 

It should be noted that although some courts, like the West Virginia Supreme Court in 

Clark, refer to the litigation privilege as an absolute privilege and others, like the Maryland 

Court of Special Appeals in Fraidin, refer to it as a qualified privilege, this is really just a 

difference in framing the privilege, not a difference in how the privilege is applied. Some courts 

consider it an absolute privilege where it applies, but say that it does not apply where the 

attorney is acting outside the scope of representation of his client‘s interests. Other courts 

consider it a qualified privilege which does not apply where an attorney is shown to be acting for 
18

his own interests. In either event, these courts have come to a general agreement that the 

litigation privilege protects attorneys from all civil suits which are raised against them by a party 

adverse to their clients, as a result of their representation of their clients, provided attorneys do 

not act beyond the scope of that representation for their own purposes. For Idaho, the litigation 

privilege is an absolute privilege, which only applies when a specific condition precedent is met, 

namely, that an attorney is acting within the scope of his employment, and not solely for his 

personal interests.

It is presumed that an attorney who is acting or communicating in relation to his 

representation of a client is acting on behalf of that client and for that client‘s interests. See 

Greenberg v. Aetna Ins. Co., 235 A.2d 576, 577-78 (Pa. 1976) (holding that ―all reasonable 

doubts (if any) should be resolved in favor of relevancy and pertinency and materiality‖); Singh 

v. HSBC Bank USA, 200 F.Supp.2d 338, 340 (S.D.N.Y. 2002) (holding that if any circumstances 

would support a finding that attorney actions are pertinent to litigation then absolute immunity 

should protect the attorney). To find otherwise would invite attorneys to divide their interest 

between advocating for their client and protecting themselves from a retributive suit. Allowing 

such a divided interest would run contrary to the Idaho Rules of Professional Conduct, because, 

as noted by the district court judge below:

[w]hile attorneys must not knowingly counsel or assist a client in committing a 

crime or fraud, Idaho‘s Rules of Professional Conduct require an attorney to 

pursue matters on behalf of a client despite opposition, obstruction or personal 

inconvenience to the attorney, and require an attorney to take whatever lawful and 

ethical measures are required to vindicate a client‘s cause or endeavor.

(Citing I.R.C.P. 1.3(1)).

Therefore, this Court holds that, as a general rule, where an attorney is sued by the 

current or former adversary of his client, as a result of actions or communications that the 

attorney has taken or made in the course of his representation of his client in the course of 

litigation, the action is presumed to be barred by the litigation privilege. An exception to this 

general rule would occur where the plaintiff pleads facts sufficient to show that the attorney has 

engaged in independent acts, that is to say acts outside the scope of his representation of his 

client‘s interests, or has acted solely for his own interests and not his client‘s.

It is true that such an approach means there is a risk that a wronged party may be denied 

civil relief under the law, but as Judge Learned Hand stated, in justifying absolute immunity for 

federal prosecutors:
19

It does indeed go without saying that an official, who is in fact guilty of 

using his powers to vent his spleen upon others, or for any other personal motive 

not connected with the public good, should not escape liability for the injuries he 

may so cause; and, if it were possible in practice to confine such complaints to the 

guilty, it would be monstrous to deny recovery. The justification for doing so is 

that it is impossible to know whether the claim is well founded until the case has 

been tried, and that to submit all officials, the innocent as well as the guilty, to the 

burden of a trial and to the inevitable danger of its outcome, would dampen the 

ardor of all but the most resolute, or the most irresponsible, in the unflinching 

discharge of their duties. Again and again the public interest calls for action which 

may turn out to be founded on a mistake, in the face of which an official may later 

find himself hard put to it to satisfy a jury of his good faith. There must indeed be 

means of punishing public officers who have been truant to their duties; but that is 

quite another matter from exposing such as have been honestly mistaken to suit 

by anyone who has suffered from their errors. As is so often the case, the answer 

must be found in a balance between the evils inevitable in either alternative. In 

this instance it has been thought in the end better to leave unredressed the wrongs 

done by dishonest officers than to subject those who try to do their duty to the 

constant dread of retaliation. 

Gregoire v. Biddle, 177 F.2d 579, 581 (2nd Cir. 1949) (emphasis added). See also, Briscoe v.

LaHue, 460 U.S. 325, 345 (1983) (quoting Judge Hand in justifying absolute witness immunity). 

This statement has clear applicability to the litigation privilege as it applies to attorneys. Finally, 

a lack of civil redress does not mean immunity from consequence and punishment. As the West 

Virginia Supreme Court wrote in Clark v. Druckman, ―[W]e believe our Rules of Civil 

Procedure, our Rules of Professional Conduct, and the court‘s inherent authority provide 

adequate safeguards to protect against abusive and frivolous litigation tactics.‖ 624 S.E. 2d 864, 

871 (W. Va. 2005). We concur with the Clark Court in this regard.

We find that when an attorney is acting in his representative capacity pursuant to 

litigation, and not solely for his own interests, he shall enjoy the litigation privilege and shall not 

be subject to suit by an opponent of his client, arising out of his representative conduct and 

communications. We now proceed to consider Reed‘s argument that the litigation privilege 

should not apply here due to the specific and unique circumstances of this case.

i. Timing

The district court below summarized Reed‘s argument – that the litigation privilege did 

not apply because Respondents were never lawfully hired as counsel by the AIA Entities – in the 

following manner:

In the instant matter, Plaintiff has argued that his is a unique situation because he 

has filed suit against the AIA corporations and its board members, that the 
20

contractual terms at the core of his underlying suit make him the sole shareholder 

of the AIA corporations and, therefore, there is a conflict between the AIA 

corporations and the board members that makes it inappropriate, even fraudulent, 

for the board, or more particularly for managing board member John Taylor, to 

retain counsel for the corporations, to direct counsel for the corporations in any 

way, or for there to be any cooperation between counsel for the corporations and 

counsel for John Taylor. Bottom line, Reed Taylor contends he is the only person 

with authority to determine who should serve as counsel for the corporations he is 

suing.

Although Reed argues that the circumstances of this case are unique, they are not. This is 

a mere contract-interpretation case. However, there is one unusual aspect of this case which, far 

from taking this case outside the scope of the litigation privilege, cries out for application of that 

doctrine with particular urgency – the timing of this suit. In most cases dealing with the 

litigation privilege, a third-party – who had been the opponent to an attorney‘s client in a 

previous lawsuit – is suing that attorney after their litigation against the client has been resolved. 

In this case Reed sued Respondents while the Underlying Case was ongoing, and yet many of his 

arguments rely upon his presumption that the Underlying Case will be decided in his favor. The 

public policies of: (1) protecting attorneys from the threat of retaliatory litigation, in order to 

ensure that they may zealously advocate for their client without fear of reprisal; and (2) 

protecting judicial economy, are magnified when confronted with not only the threat of 

retaliatory litigation, but the reality of it while the underlying suit is ongoing. 

The circumstances of this case raise an important question. Where the conduct of

opposing counsel falls outside the protection of the litigation privilege, when may a cause of 

action be instituted against that attorney? As we apply the modern litigation privilege for the 

first time in this case we have no precedent directly on point, and instead consider analogous 

actions – those for legal malpractice and malicious prosecution. 

We have previously indicated, in a case dealing with legal malpractice, that, as objective 

proof in support of actual damages is required for recovery, the statute of limitations for a legal 

malpractice claim does not begin to run until the litigation forming the basis of that claim has 

concluded. City of McCall v. Buxton, 146 Idaho 656, 661, 201 P.3d 629, 634 (2009). The clear 

reasoning behind this decision was that the cause of action cannot arise until damages are 

incurred, and the attorney‘s conduct can be reviewed under the totality of the case. See id. 

The elements that must be shown to recover on the basis of malicious prosecution are 

found in Badell v. Beeks, specifically: ―(1) That there was a prosecution; (2) That it terminated in 
21

favor of the plaintiff; (3) That the defendant was the prosecutor; (4) Malice; (5) Lack of probable 

cause; and (6) Damages sustained by the plaintiff.‖ 115 Idaho 101, 102, 765 P.2d 126, 127 

(1988) (emphases added). As in cases for legal malpractice based on conduct occurring during 

the course of a trial, in order to bring a malicious prosecution claim there must be damages and it 

must be determined that the suit was groundless, neither of which is possible prior to resolution 

of the case. 

The theme in our analyses in these two comparative causes of action is that Idaho courts 

take into consideration the significant complexities involved in application of law, such as trial 

strategies and negotiation tactics, and wait until all those complexities have resolved themselves 

prior to hearing a claim. Only when a case has been concluded may one truly identify whether 

or not a prosecution has been malicious, whether an attorney has committed malpractice, or, in 

the case at hand, whether an attorney has acted fraudulently or solely for his own benefit. 

Therefore, we conclude that a cause of action against one party‘s opponent‘s attorney in 

litigation, based on conduct the attorney committed in the course of that litigation, may not be 

properly instituted prior to the resolution of that litigation, even where the allegedly aggrieved 

party believes that the attorney in question has been acting outside the legitimate scope of 

representation and solely for his own benefit. Under this same reasoning, the allegations of 

aiding and abetting in the commission of tortious acts, although marginally pled, must await 

resolution of the Underlying Case. Until the Underlying Case is resolved a court cannot 

determine whether any tortious act was committed, let alone acts constituting the aiding and 

abetting of those alleged tortious acts.

As for Reed‘s argument, quoted above in the district court‘s summary, that he is the only 

one authorized to hire counsel for the AIA Entities, this inference does not flow from the 

allegations in Reed‘s complaints. Reed‘s complaints are largely focused on the argument that 

Respondents violated Idaho‘s Rules of Professional Conduct or breached their fiduciary duty 

toward the AIA Entities, and these claims are dependent upon Respondents being retained as 

counsel for the AIA Entities, and holding fiduciary duties toward them. Reed has failed to plead 

facts which allege that Respondents did not accept employment with the AIA Entities in good 

faith.
22

C. 12(b)(6) Analysis.

As previously stated, this Court reviews the grant of a 12(b)(6) motion de novo. 

See Losser v. Bradstreet, 145 Idaho 670, 672-73, 183 P.3d 758, 760-61 (2008); Curlee v. 

Kootenai Cnty. Fire & Rescue, 148 Idaho 391, __, 224 P.3d 458, 461 (2008).

1. Civil conspiracy and interference with a contract.

As this Court wrote in Youngblood v. Higbee:

While we ―will make every intendment to sustain a complaint that is 

defective, e.g., wrongly captioned or inartful, a complaint cannot be sustained if it 

fails to make a short and plain statement of a claim upon which relief may be 

granted.‖ Gibson v. Ada [Cnty.] Sheriff’s Dep’t, 139 Idaho 5, 9, 72 P.3d 845, 849 

(2003). We look at whether the complaint puts the adverse party on notice of the 

claims brought against it.

145 Idaho 665, 668, 182 P.3d 1199, 1202 (2008). 

Reed alleges in his complaints that Respondents have entered into a civil conspiracy with 

others, including their clients. As this Court noted in Mannos v. Moss:

A civil conspiracy that gives rise to legal remedies exists only if there is an 

agreement between two or more to accomplish an unlawful objective or to 

accomplish a lawful objective in an unlawful manner. Civil conspiracy is not, by 

itself, a claim for relief. The essence of a cause of action for civil conspiracy is 

the civil wrong committed as the objective of the conspiracy, not the conspiracy 

itself.

143 Idaho 927, 935, 155 P.3d 1166, 1174 (2007) (quoting McPheters v. Maile, 138 Idaho 391, 

395, 64 P.3d 317, 321 (2003)). In addition, ―[a]n agreement is the foundation of a conspiracy 

charge and there must be some showing of specific evidence of a plan or agreement to defraud to 

demonstrate the pendency of the conspiracy at the time the alleged fraud occurred.‖ Id. Reed‘s 

failure to make specific factual pleadings is particularly fatal here. It appears most likely that 

Reed is alleging that the goal of the conspiracy was fraudulent, and civil conspiracy must 

therefore be pled with particularity under Wasco Prods., Inc. v. Southwall Techs, Inc., 435 F.3d 

989, 990-92 (9th Cir. 2006). Furthermore, it is axiomatic that an agent acting within the scope 

of his representation cannot conspire with his principal, Afton Energy, Inc. v. Idaho Power Co., 

122 Idaho 333, 340, 834 P.2d 850, 857 (1992), and ― ̳[t]he relationship between an attorney and 

client is one of agency‘ in which the client is the principle and the attorney is the agent.‖ 

Caballero v. Wikse, 140 Idaho 329, 332, 92 P.3d 1076, 1079 (2004) (quoting Muncey v.

Children’s Home Finding and Aid Soc. of Lewiston, 84 Idaho 147, 151, 369 P.2d 586, 588 
23

(1962). Even if Reed prevails in the Underlying Case, a relationship of agency still existed 

between the Respondents and their clients.

Finally, Reed alleges in the ―Facts‖ section of his complaints that Respondents engaged 

in tortious interference with contractual rights. 

On February 22, 2007, Reed J. Taylor voted the stock of AIA Insurance, 

Inc. and attempted to take control of it pursuant to his contractual rights as 

provided under the law, the contract documents, and I.C. § 30-1-722. However, 

the interested directors of AIA Insurance, Inc. (including R. John Taylor) by and 

through [Respondents] intentionally assisted in breaching the terms of the 

Amended and Restated Stock Pledge Agreement and refused to acknowledge 

Plaintiff Reed J. Taylor‘s valid vote of the stock of AIA Insurance, Inc. and 

refused to surrender control as required. [Respondents] further engaged in 

inappropriate conduct in assisting interested parties (including R. John Taylor) in 

obtaining and/or maintaining a restraining order and preliminary injunction 

against Plaintiff Reed J. Taylor, when [Respondents] knew there was no 

legitimate legal basis to do so, that doing so was an intentional violation and 

tortious interference with Reed J. Taylor‘s contractual rights, and that the assets 

and funds of AIA Insurance, Inc. were being misappropriated and/or not 

safeguarded.

Under Idaho law it is factually impossible for a party to tortiously interfere with that party‘s own 

contract. Ostrander v. Farm Bureau Mut’l Ins. Co. of Idaho, Inc. 123 Idaho 650, 654, 851 P.2d 

946, 950 (1993). As noted above, the client-attorney relationship is one of agency, and in line 

with this Court‘s decision in Beco Const. Co, Inc. v. J-U-B Engineers, Inc., 145 Idaho 719, 184 

P.3d 844 (2008), where an agent is acting within the scope of his representation he shall be 

treated the same as his principal for purposes of tortious interference with a contract. 

Reed‘s complaints fail to allege sufficient facts to make out causes of action for civil 

conspiracy, or tortious interference with a contract. In addition, other than an attempt to claim 

that Respondents were never properly employed by the AIA Entities - a claim dealt with above -

Reed fails to allege that Respondents were acting outside the scope of their employment or solely 

for their own benefit. Therefore, these claims are also barred by the litigation privilege.

2. Legal malpractice and breach of fiduciary duty.

This Court considered a claim of legal malpractice in Harrigfeld v. Hancock, finding:

―The elements of a legal malpractice actions are: (a) the existence 

of an attorney-client relationship; (b) the existence of a duty on the 

part of the lawyer; (c) failure to perform the duty; and (d) the 

negligence of the lawyer must have been a proximate cause of the 

damages to the client . . .
24

As to the burdens of proof in such cases . . .  ̳[t]he burden 

of proving that an attorney has been negligent or failed to act with 

proper skill and that damages resulted therefrom is on the plaintiff 

client‘ and . . .  ̳[l]ikewise the burden is on the plaintiff to show 

that the negligence of the attorney was a proximate cause of the 

client‘s damage.‘‖ Sherry v. Diercks, 29 Wash. App. 433, 628 P.2s 

1336, 1338 (1981) (citations omitted).

We agree with the Washington court as to the elements of a cause of 

action for legal malpractice and to allocation of the burden of proof in such cases.

140 Idaho 134, 136, 90 P.3d 884, 886 (2004) (quoting Johnson v. Jones, 103 Idaho 702, 706-07, 

652 P.2d 650, 654-55 (1982)).

It is clear that Reed, in his complaints, has failed to allege that he is in an attorney-client 

relationship with Respondents, and therefore lacks the privity necessary to sue Respondents for 

legal malpractice. Harrigfeld is the only case in which this Court has found an exception to this 

requirement; specifically this Court found that the intended beneficiary of a testamentary 

instrument would have standing to bring a malpractice claim against the attorney who drafted 

said instrument. Id. at 138, 90 P.3d at 888. This Court went on to conclude that, ―[a] direct 

attorney-client relationship is required to exist between the plaintiff and the attorney-defendant in 

a legal malpractice action except in this very narrow circumstance.‖ Id. at 139, 90 P.3d at 889. 

This principle was reaffirmed in a case to which Reed was a party – Taylor v. Maile, 142 Idaho 

253, 127 P.3d 156 (2005). Reed cites to law from other jurisdictions, ignoring the wellestablished Idaho precedent, in arguing that third-party beneficiaries to an attorney-client 

relationship may have standing to pursue malpractice claims against an attorney. Reed offers no 

compelling reason why this Court should expand its carefully reasoned analysis in Harrigfeld, 

and it is incredulous that Reed would attempt to assert that attorneys hired by the AIA Entitites, 

to fight off Reed‘s litigation against those entities, were being retained for Reed‘s benefit. As 

Reed has failed to plead facts sufficient to find that he has standing to bring claims against 

Respondents for legal malpractice, we find that Reed has failed to state a claim upon which relief 

may be granted, as to malpractice.

As for Reed‘s claim that Respondents breached their fiduciary duties, he has failed to 

allege facts establishing the existence of a duty on the part of Respondents toward Reed. As this 

Court has held, ―[t]he scope of an attorney‘s contractual duty to a client is defined by the 

purposes for which the attorney is retained.‖ Johnson v. Jones, 103 Idaho 702, 704, 652 P.2d 

650, 652 (1982). Reed‘s complaints allege that he has been harmed as a result of Respondents
25

not acting in the best interests of the AIA Entities, but Reed‘s complaints also specifically state 

that he is not suing under a derivative cause of action. Reed has failed to allege facts which can 

support a finding that Respondents owed any fiduciary duty to Reed personally.

Reed, also claims that his complaints and amended complaints pled causes of action for 

fraud and constructive fraud. Pursuant to Idaho Rule of Civil Procedure 9(b), fraud must be pled 

with particularity. As this Court wrote in Glaze v. Deffenbaugh:

A party must establish nine elements to prove fraud: ―1) a statement or a 

representation of fact; 2) its falsity; 3) its materiality; 4) the speaker‘s knowledge 

of its falsity; 5) the speaker‘s intent that there be reliance; 6) the hearer‘s 

ignorance of the falsity of the statement; 7) reliance by the hearer; 8) justifiable 

reliance; and 9) resultant injury.‖

144 Idaho 829, 833, 172 P.3d 1104, 1108 (2007) (quoting Mannos v.Moss, 143 Idaho 927, 931, 

155 P.3d 1166, 1170 (2007)). Reed fails to plead these elements in a general sense, let alone 

with particularity and, as such, has failed to state a claim upon which relief may be granted as to 

fraud.

―An action in constructive fraud exists when there has been a breach of a duty arising 

from a relationship of trust and confidence, as in a fiduciary duty.‖ Hines v. Hines, 129 Idaho 

847, 853, 934 P.2d 20, 26 (1997). ―Examples of relationships from which the law will impose 

fiduciary obligations on the parties include when the parties are: members of the same family, 

partners, attorney and client, executor and beneficiary of an estate, principal and agent, insurer 

and insured, or close friends.‖ Mitchell v. Barendregt, 120 Idaho 837, 844, 820 P.2d 707, 714 

(Ct. App. 1991) (found to be in error on other grounds by Polk v. Larrabee, 135 Idaho 303, 314, 

17 P.3d 247, 258)). It is clear that Reed has not alleged facts sufficient to support an inference 

that he is in an analogous relationship with Respondents, and has therefore not pled a claim upon 

which relief may be granted as to constructive fraud.

3. Violation of the Idaho Consumer Protection Act, I.C. § 48-601, et seq.

In order to have standing under the Idaho Consumer Protection Act (ICPA), I.C. § 48-

601, et seq., the aggrieved party must have been in a contractual relationship with the party 

alleged to have acted unfairly or deceptively. See I.C. 48-608(1) (―Any person who purchases or 

leases goods or services and thereby suffers . . .‖); Haskin v. Glass, 102 Idaho 785, 788, 640 P.2d 

1186, 1189 (Ct. App. 1982) (holding ―that a claim under the ICPA must be based upon a 

contract‖). It is clear from Reed‘s complaints that he is not alleging that he entered into a 

contractual relationship with Respondents. Therefore, Reed‘s complaints have failed to state 
26

claims for relief under the ICPA. Respondents further point out that the ICPA only permits 

recovery for certain specific prohibited actions that are deemed to be unfair or deceptive. See 

I.C. §§ 48-603 – 48-603(E). Reed‘s complaints fail to allege which specific prohibited unfair or 

deceptive practice they are meant to have engaged in. Even assuming all facts pled by Reed to 

be true, he has failed to state a claim for which relief may be granted under the ICPA.

4. Conversion

Reed alleges in his complaints that Respondents‘ acceptance of payment for their work as 

attorneys for the AIA Entities amounts to conversion. Respondents argue that Reed‘s complaints 

fail to allege facts which, if true, would demonstrate that Respondents‘ conduct meets the three 

elements of conversion under Idaho law. This Court defined conversion in Peasley Transfer & 

Storage Co. v. Smith, as ―a distinct act of dominion wrongfully asserted over another‘s personal 

property in denial of or inconsistent with rights therein.‖ 132 Idaho 732, 743, 979 P.2d 605, 616 

(1999). This definition can be broken down into three elements which are required for a claim of 

conversion to be valid: (1) that the charged party wrongfully gained dominion of property; (2) 

that property is owned or possessed by plaintiff at the time of possession; and (3) the property in 

question is personal property.

Here it is readily apparent that Reed‘s complaints failed to allege that the property that 

Respondents are meant to have converted was personal property and, therefore, analysis of the 

other elements is unnecessary. Here Reed has alleged that Respondents converted a sum of 

money, and Idaho case law clearly states that ―[n]ormally, conversion for misappropriation of 

money does not lie unless it can be described or identified as a specific chattel.‖ Warm Springs

Props., Inc. v. Andora Villa, Inc., 96 Idaho 270, 272, 526 P.2d 1106, 1108 (1974). See also High 

View Fund, L.P. v. Hall, 27 F. Supp.2d 420, 429 (S.D.N.Y. 1994) (―More particularly, if the 

alleged converted money is incapable of being described or identified in the same manner as a 

specific chattel, it is not the proper subject of a conversion action.‖) (internal quotations and 

citations omitted). Nothing in Reed‘s complaints suggests that the sums paid to Respondents for 

the services they rendered to their corporate clients could be described or identified as specific 

chattel. As such, we affirm the district court‘s grant of Respondents‘ motions to dismiss as to 

this claim.
27

D. The district court did not abuse its discretion in denying Reed’s motions to amend his 

complaints.

The district court below denied Reed‘s motions for leave to file amended complaints, on 

the ground that granting these motions would be futile as the proposed amended complaints 

would not have withstood a motion to dismiss. 

Under Idaho law, motions for leave to amend pleadings are to be liberally granted, 

however, it is also the case that, as this Court said in Black Canyon Racquetball Club, Inc. v.

Idaho First National Bank: 

[i]n determining whether an amended complaint should be allowed, where leave 

of the court is required under Rule 15(a), the court may consider whether the new 

claims proposed to be inserted into the action by the amended complaint state a 

valid claim. If the amended pleading does not set out a valid claim, or if the 

opposing party would be prejudiced by the delay in adding the new claim, or if 

the opposing party has an available defense such as a statute of limitations, it is 

not an abuse of discretion for the trial court to deny the motion to file the 

amended complaint.

119 Idaho 171, 175, 804 P.2d 900, 904 (1991) (internal citation omitted).

As was acknowledged by the district court, Reed‘s proposed amended complaints set out 

the same causes of action as his original complaints while adding derivative causes of action. 

Having dealt with Reed‘s direct causes of action above, and finding no changes in his proposed 

amended complaint sufficient to alter our analyses, these issues shall not be re-examined. We 

now consider Reed‘s proposed derivative causes of action.

Idaho Code § 30-1-741 sets out the minimum requirements which must be met in order 

for a derivative claim to be brought, stating:

Standing. A shareholder may not commence or maintain a derivative proceeding 

unless the shareholder:

(1) Was a shareholder of the corporation at the time of the act or omission 

complained of or became a shareholder through transfer by operation of law from 

one (1) who was a shareholder at that time; and

(2) Fairly and adequately represents the interests of the corporation in enforcing 

the right of the corporation.

Reed does not allege in either his original complaints or proposed amended complaints that he is 

a shareholder of either AIA Entity. Rather, Reed claims the status of a former shareholder whose 

stock was redeemed, seeking to recover the balance owing on that stock redemption. Even if 

Reed‘s claims are true that his security interests entitle him to gain stock in the AIA Entities, he 
28

did not hold stock when this lawsuit was commenced, and does not claim to. Therefore, it is 

clear under I.C. § 30-1-741 that Reed was not a shareholder at the time he brought this suit, and 

has no standing to pursue a derivative claim on behalf of the corporation.6 

As Reed‘s proposed amended complaints did not add any facts in support of his direct 

causes of action raised in his original complaints, and as he clearly lacked standing under Idaho 

law to bring derivative claims, not being the shareholder of the corporation he wished to bring 

suit on behalf of, we find that the district court acted within its discretion in denying Reed‘s 

motions for leave to amend his complaints on the ground of futility.

E. Attorney fees below

As this Court stated in Henderson v. Henderson Investment Properties, L.L.C.:

When reviewing a trial court‘s award of attorney fees, this Court applies an abuse 

of discretion standard. ―To determine whether there is an abuse of discretion this 

Court considers whether (1) the court correctly perceived the issue as one of 

discretion; (2) the court acted within the boundaries of such discretion and 

consistently with legal standards applicable to specific choices; and (3) the court 

reached its decision by an exercise of reason.‖

148 Idaho 638, __, 227 P.3d 568, 569-70 (2010) (quoting Lee v. Nickerson, 146 Idaho 5, 9, 189 

P.3d 467, 471 (2008) (internal citations omitted).

It is clear from the district court‘s order granting attorney fees that it recognized the issue 

as one of discretion, and that it reached its decision through an exercise of reason, on all bases it 

considered. The question therefore, is whether the court acted within the boundaries of 

discretion consistent with legal standards in reaching its determinations. The district court 

awarded attorney fees under: (1) I.C. § 12-121 and I.R.C.P. 54(e)(1); (2) I.C. § 30-1-746(2)-(3); 

and (3) I.C. § 48-608(5). We shall review each to determine whether the district court exceeded 

the boundaries of its discretion.

1. Idaho Code § 12-121 and I.R.C.P. 54(e)(1)

Idaho Code § 12-121 states: 

In any civil action, the judge may award reasonable attorney‘s fees to the 

prevailing party or parties, provided that this section shall not alter, repeal or 

 

6

Although Reed‘s lack of shareholder status is determinative, it is also unlikely that Reed could meet the second 

qualification, of fairly and adequately representing the interests of the corporation as he had filed suit in the 

Underlying Case seeking to recover corporate money and assets for his own individual benefit. See New Crawford 

Valley, Ltd. v. Benedict, 847 P.2d 642 (Colo. App. 1993); Guenther v. Pacific Telecom, Inc., 123 F.R.D. 341 (D. 

Ore. 1987).
29

amend any statute which otherwise provides for the award of attorney fees. The 

term ―party‖ or ―parties‖ is defined to include any person, partnership, 

corporation, association, private organization, the state of Idaho or political 

subdivision therefore.

Idaho Rule of Civil Procedure 54(e)(1) reads as follows:

Attorney Fees. In any civil action the court may award reasonable attorney fees, 

which at the discretion of the court may include paralegal fees, to the prevailing 

party or parties as defined in Rule 54(d)(1)(B), when provided for by any statute 

or contract. Provided, attorney fees under section 12-121, Idaho Code, may be 

awarded by the court only when it finds, from the facts presented to it, that the 

case was brought, pursued or defended frivolously, unreasonably or without 

foundation . . .

In reaching his conclusion that all of Reed‘s claims were brought frivolously, 

unreasonably, and without foundation, the district court clearly considered each claim which had 

been brought by Reed against the Respondents, and clearly articulated why it felt each claim was 

brought frivolously, unreasonably and without foundation. However, in its reasoning the district 

court applied the litigation privilege which, having never been addressed or applied previously 

by Idaho courts, is an issue of first impression. As such, Reed argues that it was inappropriate to 

grant attorney fees under I.C. § 12-121. See Campbell v. Kildew, 141 Idaho 640, 651, 115 P.3d 

731, 742 (2005) (―Where a case involves a novel legal question, attorney fees should not be 

granted under I.C. § 12-121.‖). However, as may be seen from the foregoing analysis, even 

without taking the litigation privilege into consideration, the district court‘s decision to grant the 

12(b)(6) motions to dismiss would be affirmed. This is because these claims were brought 

frivolously, unreasonably, and without foundation. The complaints filed by Reed are overly 

conclusive in nature with insufficient factual allegations, even under Idaho‘s notice-pleading 

standard, and demonstrate an often-incorrect understanding of the law. We therefore uphold the 

district court‘s grant of attorney fees under I.C. § 12-121 and I.R.C.P. 54(e)(1).

2. Idaho Code § 30-1-746(2)-(3)

Idaho Code § 30-1-746(2)-(3) provides that upon the termination of a derivative 

proceeding acourt may:

(2) Order the plaintiff to pay any defendant‘s reasonable expenses, including 

counsel fees, incurred in defending the proceeding if it finds that the proceeding 

was commenced or maintained without reasonable cause or for an improper 

purpose; or

(3) Order a party to pay an opposing party‘s reasonable expenses, including 

counsel fees, incurred because of the filing of a pleading, motion or other paper, if 
30

it finds that the pleading, motion or other paper was not well grounded in fact, 

after reasonable inquiry, or warranted by existing law or a good faith argument for 

the extension, modification or reversal of existing law and was interposed for an 

improper purpose, such as to harass or cause unnecessary delay or needless 

increase in the cost of litigation.

―An award of attorney fees under [I.C. § 30-1-746] is discretionary and should be subject 

to review and vacated only upon a showing of an abuse of discretion.‖ McCann v. McCann, 138 

Idaho 228, 238, 61 P.3d 585, 595 (2002). Reed attempted to plead derivative causes of action 

against Respondents, but as the district court denied Reed‘s motions for leave to amend his 

complaints, the claims were never before the court. As the derivative causes of action were 

never a part of Reed‘s complaints the termination of this case cannot properly be characterized as 

the termination of a derivative proceeding. We find that the district court abused its discretion in 

awarding attorney fees under this statute, but as we uphold attorney fees under I.C. § 12-121 and 

I.R.C.P. 54(e)(1) this error is harmless.

3. Idaho Code § 48-608(5)

Under ICPA, I.C. § 48-608(5):

Costs shall be allowed to the prevailing party unless the court otherwise directs. 

In any action brought by a person under this section, the court shall award, in 

addition to the relief provided in this section, reasonable attorney fees to the 

plaintiff if he prevails. The court in its discretion may award attorney‘s fees to a 

prevailing defendant if it finds that the plaintiff‘s action is spurious or brought for 

harassment purposes only.

As Reed never purchased or leased any goods or services from Respondents and clearly 

did not meet the threshold requirements of making a claim under ICPA, it cannot be said that the 

district court abused his discretion in finding that Reed brought this claim spuriously, for the 

harassment purposes only. We therefore affirm the grant of attorney fees under the authority 

provided in I.C. § 48-608(5).

F. Attorney Fees

Respondents request attorney fees on appeal pursuant to Idaho Appellate Rule 41, Idaho 

Code §§ 12-121, 30-1-746, and 48-608(5). Consistent with the immediately preceding analysis, 

we deny attorney fees under I.C. § 30-1-746 for the same reason we find that they were 

improperly awarded on this basis below. We find that Respondents are entitled to attorney fees 

under I.C. § 48-608(5), as Reed has appealed his ICPA claim despite the fact that the claim 

clearly failed as a matter of law, and was brought spuriously for harassment purposes only. 
31

Additionally, Respondents are entitled to attorney fees under I.C. § 12-121 and I.A.R. 41 as this 

appeal was brought spuriously and without foundation, for harassment purposes only.

V. CONCLUSION

The district court erred in taking judicial notice of the Underlying Case when considering 

Respondents‘ motions to dismiss under 12(b)(6), but as this Court considers the grant of a 

motion to dismiss on a de novo basis and has not considered the Underlying Case in this 

determination, this error is found harmless. We affirm the district court‘s grant of Respondents‘ 

12(b)(6) motions to dismiss. 

We hold that the litigation privilege applies in Idaho, and bars a litigant from bringing 

claims against the attorneys of his adversary in that litigation, where the claims are grounded in 

the attorneys‘ conduct or communications made in the course of representing their clients in that 

litigation, and the attorneys are acting within the scope of that representation and not solely for 

their own benefit. We find that in all instances the claims brought by Reed against Respondents

were: (1) barred by the litigation privilege; (2) supported by insufficiently pled facts; (3) 

insufficient as a matter of law; or (4) are not ripe for litigation.

We affirm the district court‘s act of discretion in denying Reed‘s motions for leave to amend 

his complaints because (1) Reed was not a shareholder of the Corporations at the time of the 

alleged injury and therefore lacked standing to bring derivative actions, and (2) Reeds proposed 

alterations to his pleading regarding his direct causes of action did not alter the analyses, as 

applied to his original complaints.

The district court abused its discretion in awarding attorney fees to Respondents pursuant to 

I.C. § 30-1-746, but properly awarded attorney fees under I.C. §§ 12-121 and 48-608(5). Costs 

and attorney fees to Respondents.

Chief Justice EISMANN and Justices J. JONES and TROUT, J., Pro Tem, CONCUR.

HOSACK, J., Pro tem, specially concurring.

I concur with both the analysis and the holding. I only note that, in my opinion, the 

application of the litigation privilege is determinative as to the motion to dismiss. Once the 

litigation privilege is determined to be the applicable law, the trial court‘s grant of the motion to 

dismiss and its denial of the motion to amend could be affirmed on those grounds alone.