Anderson v. Interpath Laboratory, Inc., et al.

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UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF IDAHO
NOLAN ANDERSON, on behalf of himself
individually, and on behalf of all others
similarly situated,
Plaintiff,
v.
INTERPATH LABORATORY, INC., an
Oregon corporation; and PRAXIS HEALTH,
P.C., an Oregon Professional Corporation,
Defendants.
Case No. 2:24-cv-00341-AKB
MEMORANDUM DECISION AND
ORDER
INTRODUCTION
Pending before the Court is Defendants Interpath Laboratory, Inc. and Praxis Health, P.C.’s
Motion to Dismiss (Dkt. 14). Having reviewed the record and the parties’ submissions, the Court
finds that the facts and legal arguments are adequately presented and that oral argument would not
significantly aid its decision-making process. The Court therefore decides the motion on the
briefing. Dist. Idaho Loc. Civ. R. 7.1(d)(1)(B); see also Fed. R. Civ. P. 78(b). For the reasons set
forth below, the motion is denied.
BACKGROUND
Plaintiff alleges that on August 15, 2023, he received routine medical care at Prairie Family
Medicine, a clinic operated by Praxis Health, P.C. (Praxis) (Dkt. 1 ¶¶ 21, 45). Praxis is owned by
Defendant Interpath Laboratory, Inc. (Interpath) (id. at ¶ 3; Dkt. 14-1 at 4 n.2). During that visit,
Prairie staff drew Plaintiff’s blood and sent the sample to Interpath for testing (Dkt. 1 ¶ 21).
Plaintiff alleges that after the visit, Prairie contacted him and informed him that, due to the
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technician’s error, the blood sample was insufficient and that a second blood draw was required
(id. at ¶ 21). Plaintiff alleges that Prairie expressly assured him that “he would not be charged for
the cost associated with the second blood draw” necessitated by the technician’s error (id.).
Plaintiff returned to Prairie the following day on August 16, 2023, for the second blood
draw, which was again submitted to Interpath for laboratory testing (id.). Plaintiff alleges that,
notwithstanding Prairie’s assurance made on August 15, Interpath later billed him for “both the
first and second blood draw” (id. at ¶ 22). On October 16, Plaintiff received an invoice from
Interpath reflecting charges on both August 15 and August 16 with the line item “draw fee”
appearing only once on August 16 (id. at Ex. A-1).
Plaintiff alleges he promptly disputed the invoice. On October 22 and October 26, 2023,
Plaintiff emailed Interpath explaining that he was assured that he “would not be charged for
services arising out of coming back in” and that he “would not be charged for the tech’s mistake
of not drawing enough blood” and requesting the bill be corrected (id. at ¶ 23; id. at Ex. B-1).
Interpath responded that it would not adjust the charges without confirmation from Prairie, stating
that “if we need to write off the charges, we need a confirmation first from the provider” (id. at
¶ 24; id. at Ex. B-1).
Plaintiff alleges he contacted Prairie, and on November 1, 2023, a Prairie representative
agreed that Plaintiff should not have been charged and stated that Prairie would contact Interpath
to correct the bill (id. at ¶ 25). Plaintiff relayed this information to Interpath and again requested a
revised invoice (id. at ¶ 26; id. at Ex. B-2). Interpath responded that it had not yet received
confirmation from Prairie and declined to issue a corrected bill (id.).
On or about November 9, 2023, Interpath issued another invoice that again included
charges Plaintiff contends were erroneous (id. at ¶ 27; id. at Ex. C-1). That invoice was marked
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“FINAL NOTICE” and stated: “To prevent further action being taken on your account, REMIT
PAYMENT IN FULL within 15 days of the statement date” (id.). Plaintiff alleges that he continued
to dispute the charges throughout November and early December 2023 (id. at ¶¶ 28-29). Further,
he alleges that on December 5, 2023, he spoke with “the same Prairie representative,” who agreed
he should not have been billed and assured him Interpath would be contacted (id. at ¶ 28).
Despite the ongoing dispute, Plaintiff alleges that Interpath referred the debt to a third-
party 	collection 	agency. 	On 	December 	10, 	2023, 	Interpath 	sent 	Plaintiff 	a 	bill 	stating:
“*COLLECTIONS* 	YOUR 	ACCOUNT 	MAY 	HAVE 	BEEN 	TURNED 	OVER 	TO
COLLECTIONS” (id. at ¶ 29; id. at Ex. D). On December 19, Plaintiff received correspondence
from Bonneville Collections notifying him that it had been assigned the debt and was attempting
to collect (id. at ¶ 30; id. at Ex. E). Interpath explained that its system “automatically forwards any
balance on the account that remains unresolved or outstanding to a collection agency after 90 days
from the received date from the insurance” (id. at ¶ 32; id. at Ex. B-3).
Plaintiff further alleges that months later, after the account had already been referred to
collections, Interpath issued revised billing statements reflecting a reduction to the amount
previously billed. Specifically, on February 7, 2024, Interpath sent Plaintiff a bill showing a blood
draw fee of $17.00, an adjustment of “($33.99)” for a balance of “($16.99)” (id. at ¶ 33; id. at
Ex. F-1). It followed up with another invoice which made no reference to the blood draw but
reported that his account had been turned over to collections (id. at ¶ 34; id. at Ex. G).
Plaintiff brings claims under the Idaho Patient Act (IPACT), Idaho Code §§ 48-301–48-
315, alleging that Defendants engaged in an “extraordinary collection action,” as defined by
IPACT, without first providing a statutorily sufficient final notice or complying with IPACT’s
procedural requirements (id. at ¶¶ 48-55). Plaintiff also asserts a claim under the Idaho Consumer
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Protection Act (ICPA), Idaho Code §§ 48-601–48-619, alleging that Defendants engaged in unfair
and deceptive billing and collection practices, including billing for disputed charges and referring
those charges to collections (id. at ¶¶ 56-65).
Defendants move to dismiss both claims under Rule 12(b)(6) of the Federal Rules of Civil
Procedure (Dkt. 14).
LEGAL STANDARD
Under Rule 12(b)(6), a motion to dismiss for failure to state a claim on which relief can be
granted tests the legal sufficiency of a complaint. Navarro v. Block, 250 F.3d 729, 732 (9th Cir.
2001). In assessing dismissal of claims under Rule 12(b)(6), the Court must accept factual
allegations in the complaint as true and construe the pleadings in the light most favorable to the
nonmoving party. Manzarek v. St. Paul Fire & Marine Ins. Co., 519 F.3d 1025, 1031 (9th Cir.
2008). To survive a motion to dismiss under Rule 12(b)(6), a complaint must allege enough facts
to state a claim to relief that is plausible on its face. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570
(2007). A claim has facial plausibility when the plaintiff pleads factual content that allows the court
to draw the reasonable inference that the defendant is liable for the misconduct alleged. Ashcroft
v. Iqbal, 556 U.S. 662, 678 (2009).
The Court need not accept as true conclusory allegations, unreasonable inferences, legal
characterizations, or unwarranted deductions of fact or legal conclusions couched as facts. Id. at
678-79; Cousins v. Lockyer, 568 F.3d 1063, 1067 (9th Cir. 2009). Generally, a district court may
not consider any materials beyond the complaint when ruling on a Rule 12(b)(6) motion. Hal
Roach Studios, Inc. v. Richard Feiner & Co., 896 F.2d 1542, 1555 n.19 (9th Cir. 1989). If the court
considers evidence outside the pleadings, it must convert a Rule 12(b)(6) motion into a motion for
summary judgment under Rule 56. A court may, however, consider certain materials—documents
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attached to the complaint, documents incorporated by reference in the complaint, or matters of
judicial notice—without converting the motion to dismiss into a motion for summary judgment.
United States v. Ritchie, 342 F.3d 903, 908 (9th Cir. 2003).
ANALYSIS
A. 	Idaho Patient Act (IPACT)
Plaintiff alleges that Defendants violated IPACT1 by referring his medical debt to a third-
party collection agency without first providing a statutorily sufficient “final notice before
extraordinary collection action” and without complying with IPACT’s procedural prerequisites.
Defendants argue that no “extraordinary collection action” occurred at all because the referral to
collections took place more than sixty days after Plaintiff received an invoice that Defendants
characterize as a valid final notice.
IPACT defines an “extraordinary collection action” to include “selling, transferring, or
assigning any amount of a patient’s debt to any third party” prior to sixty days from the patient’s
receipt of a “final notice before extraordinary collection action.” Idaho Code § 48-303(3)(a)(i).
Selling a debt to a third-party collection agency less than sixty days after the patient receives a
final notice, then, is an extraordinary collection action.
A “final notice before extraordinary collection action” is a written notice that must contain
specific enumerated information, including a detailed description of all reductions, adjustments,
offsets, and third-party payor payments, as well as the final amount the patient is liable to pay after
1 	IPACT was passed by the Idaho Legislature in 2020. Its legislative purpose indicates the
“Idaho legislature finds that medical billing practices have little visibility to Idaho citizens. As a
result, consumers often find themselves in collection actions for debts they were unaware of, from
health care providers whom they do not recognize.” Idaho Code § 48-302. “Once in collections,
current Idaho law enables excessive attorney’s fees and fails to provide judges with clear guidance
to combat abuses of the collections process. This chapter shall govern the fair collection of debts
owed to health care providers.” Id.
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all applicable reductions. Idaho Code § 48-303(4)(a)(vi)–(vii). For purposes of calculating
statutory timelines in the event of multiple notices, the operative “final notice” is “the notice that
first supplied the information required by paragraph (a) of this subsection if such information did
not change in any subsequent notices.” Idaho Code § 48-303(4)(b) (emphasis added).
Defendants argue that Interpath satisfied IPACT’s Final Notice requirement because the
October 8, 2023, invoice (attached to the Complaint as Exhibit A) qualifies under Idaho Code § 48-
303(4). They contend that this invoice was the first written statement supplying all required
information and therefore triggered the statutory waiting periods. More specifically, Defendants
assert that the October 8 invoice contained the core elements required by § 48-303(4): Plaintiff’s
identifying information; Interpath’s name, address, and phone number; a list of the laboratory
services performed with dates and charges; the name of the insurer to whom the charges were
submitted; an explanation of insurance reductions; and the final amount due.
The billing exhibits appended to the Complaint reflect the information required by § 48-
303(4)(a) changed in later notices. After Plaintiff’s 	account had already been referred to
collections, Defendants issued a revised billing statement reflecting a reduction to (and then
elimination of) the draw fee and a corresponding change to the final amount allegedly owed. Those
changes altered core elements of a statutory “final notice,” including “a list of the goods and
services . . . provided,” “all reductions, adjustments, [and] offsets,” and “the final amount that the
patient is liable to pay.” Idaho Code § 48-303(4)(a)(vi)–(vii).
Because the required information changed in subsequent notices concerning care Plaintiff
received on August 15 and 16, 2023, § 48-303(4)(b) precludes treating any earlier invoice as the
operative “final notice before extraordinary collection action” for purposes of IPACT’s timing
provisions. Accepting Plaintiff’s allegations as true, then, and even assuming (without deciding)
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that Defendants’ interpretation of the law is correct, Plaintiff plausibly alleges that no statutorily
valid and operative final notice was provided before Defendants referred his account to a third-
party collection agency. This allegation is sufficient to state a claim for relief under IPACT.
Accordingly, Defendants’ motion to dismiss the IPACT claim is denied.
The Court notes briefly that Defendants also argue that even if their supposed “final notice”
lacked certain statutorily required pieces of information, it “substantially complied” with IPACT’s
statutory requirements. But the earlier notices fail to be “final notices” because the information
they contain changed, not because they were missing information (an issue the Court does not
decide). Moreover, even if that were not the case, taking Plaintiff’s allegations as true the Court
would be constrained to give effect to the “final notice” warning in the November 9, 2023, invoice.
By December 19, his debt had been transferred to collections, which is less than sixty days even
from November 9.
B. 	Idaho Consumer Protection Act (ICPA)
Defendants also move to dismiss Plaintiff’s ICPA claim, arguing that Plaintiff has failed to
plausibly allege deceptive or unfair conduct or an ascertainable loss. The Court disagrees.
The ICPA prohibits unfair or deceptive acts or practices in trade or commerce. Idaho Code
§ 48-603. To state a claim, a plaintiff must plausibly allege that: (1) he purchased goods or services;
(2) the defendant engaged in unfair or deceptive conduct; and (3) the conduct caused an
ascertainable loss of money or property. Idaho Code § 48-608(1).
Plaintiff alleges that he was expressly promised he would not be charged for a second blood
draw necessitated by technician error; Defendants nevertheless billed him for that blood draw; he
promptly and repeatedly disputed the charge; and Defendants referred the disputed debt to
collections despite being aware of the dispute. Plaintiff further alleges that Defendants engaged in
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this practice on a widespread and systematic basis, relying on the fact that consumers will often
pay small, disputed amounts rather than contest them.
Taking these allegations as true, Plaintiff has plausibly alleged conduct that could be found
deceptive or unfair under the ICPA. Billing for services allegedly promised to be free, representing
that payment is owed despite a known dispute, and invoking the collections process to pressure
payment of a disputed charge may constitute misleading or unfair practices within the meaning of
the ICPA. See Ridgeline Medical, LLC v. Lyon, No. 52069-2024, 2026 WL 71109, at *9 (Idaho
Jan. 9, 2026) (“Reporting inaccurate information about a debt, seeking to collect an invalid debt,
or failing to permit patients an opportunity to pay a debt in advance of commencing extraordinary
collection activities can have negative and adverse effects on a patient.”). As the Idaho Supreme
Court in Ridgeline explains, the “IPA’s requirements to provide patients with certain notices and
wait a specified timeframe before commencing extraordinary collection activities to give the
patient time to pay the debt or make payment arrangements are reasonable efforts to serve the
State’s purpose to protect patients from abuses of the medical debt collection process.” This Court
is not persuaded that conduct plausibly alleged to violate a statute enacted to protect patients from
abusive medical debt collection practices would not also constitute unfair or deceptive conduct
within the meaning of the ICPA, particularly where debt collection activity is expressly included
within the ICPA’s scope.
Plaintiff has also plausibly alleged an ascertainable loss. Although the amount at issue is
small, Plaintiff alleges that he (as part of a class) was subjected to collection activity and economic
pressure to pay a charge he contends was not owed. At the pleading stage, exposure to collection
efforts and pressure to pay a disputed charge are sufficient to plausibly allege an ascertainable loss
under Idaho Code § 48-608(1). See Idaho Code § 48-602 (“Trade and commerce mean the
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advertising, offering for sale, selling, leasing, renting, collecting debts arising out of the sale or
lease of goods or services . . . . ”).
Defendants rely heavily on Litster Frost Injury Laws., PLLC v. Idaho Injury Law Group,
PLLC, 518 P.3d 1, 12-13 (Idaho 2022). Litster Frost, however, confirms—not undermines—that
the ICPA’s “ascertainable loss” requirement is broader than completed payment. In that case, the
Idaho Supreme Court expressly reasoned that “claims against the settlement fund” constituted an
“ascertainable loss of money or property” because “[a]ny deprivation” of money that “is capable
of being discovered, observed, or established” suffices, even before funds are finally disbursed. Id.
(“Gryder’s ascertainable loss of money is in the costs claimed by Litster against the settlement
fund.”). Also, the Court’s decision in Pickering v. Sanchez is consistent with that reasoning,
reiterating that the touchstone is whether the challenged conduct “caused the consumer to suffer
an ‘ascertainable loss of money or property,’” not whether the loss has already been irreversibly
paid. 544 P.3d 135, 142 (Idaho 2024) (quoting Idaho Code § 48-608(1)).
Together, these cases foreclose claims based on abstract dissatisfaction, but they also reject
the notion that a defendant may evade ICPA liability merely because the financial deprivation takes
the form of disputed charges, liens, or collection claims rather than a consummated payment.
Plaintiff has adequately stated a claim for relief under the ICPA. Accordingly, Defendants’ motion
to dismiss the ICPA claim is denied.
For the foregoing reasons, Defendants’ Motion to Dismiss (Dkt. 14) is DENIED.
January 22, 2026
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