Wells Pharmacy Network, L.L.C. v. Iowa Board of Pharmacy
16-1084
| Iowa Ct. App. | Nov 8, 2017Background
- Wells Pharmacy Network, LLC (Florida-based) was charged in an Iowa Board of Pharmacy contested case; Wells moved to dismiss four of the counts and the Board denied that motion after a hearing.
- Prior to the scheduled contested-case hearing, Wells filed a petition for immediate judicial review and stay under Iowa Code § 17A.19(1), asking the district court to remand with directions to grant its motion to dismiss.
- The Board moved to dismiss Wells’s petition on exhaustion grounds, arguing Wells had not satisfied the narrow requirements for immediate review of an intermediate procedural order.
- Wells argued the futility exception to exhaustion applied because the Board already ruled against it and was unlikely to change course, making further administrative proceedings pointless.
- The district court dismissed Wells’s petition for failing to exhaust administrative remedies, relying on precedent that courts should not assume futility and should allow agencies an opportunity to correct errors. Wells appealed; the Court of Appeals affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether immediate judicial review of the Board’s procedural denial is proper under §17A.19(1) | The Board’s procedural order is reviewable now; forcing Wells into the contested hearing would be time-consuming and expensive | Wells must exhaust administrative remedies unless narrow statutory requirements for immediate review are met | Denied — Wells must exhaust administrative remedies before judicial review |
| Whether the futility exception to exhaustion applies | The Board already ruled on the legal issues; further proceedings would be futile and re-litigation before the agency is unnecessary | Futility is not presumed; agencies should be given the opportunity to correct errors and are capable of reconsidering legal rulings | Denied — no showing the Board is incapable of granting relief; futility exception not met |
| Whether review of final agency action would be inadequate (one statutory precondition for immediate review) | Immediate review was necessary because later review would be inadequate remedy due to expense and delay | Final agency action would provide adequate judicial remedy; immediate review is limited and narrowly applied | Held against Wells — statutory precondition for immediate review not satisfied |
| Whether allowing immediate review of this intermediate order would undermine the administrative scheme | Wells implied that denying immediate review would force duplicative legal proceedings | The Board argued immediate review of every prehearing order would disrupt administrative process | Court agreed with Board — broad immediate review would undermine administrative process |
Key Cases Cited
- Salsbury Labs. v. Iowa Dep’t of Envtl. Quality, 276 N.W.2d 830 (Iowa 1979) (explains limits on bypassing exhaustion; futility exception narrow)
- Pro Farmer Grain v. Iowa Dep’t of Agric., 427 N.W.2d 466 (Iowa 1988) (discusses requirements for immediate judicial review of agency orders)
- Richards v. Iowa State Commerce Comm’n, 270 N.W.2d 616 (Iowa 1978) (addresses final-agency-action requirement and narrow exceptions)
- North River Ins. Co. v. Iowa Div. of Ins., 501 N.W.2d 542 (Iowa 1993) (describes exhaustion doctrine — review after agency action finalized)
- Sierra Club Iowa Chapter v. Iowa Dep’t of Transp., 832 N.W.2d 636 (Iowa 2013) (reiterates courts should not lightly assume administrative remedies are futile)