JEFF SOUTHARD, TRISH SOUTHARD, JEFFREY STICKEL, HEATHER STICKEL, MEL LINT, KEITH GOODYK, and GREG DANA, On Behalf of Themselves and All Others Similarly Situated in the State of Iowa
State: Iowa
Docket No: No. 137 / 04-1972
Case Date: 06/22/2007
Preview: IN THE SUPREME COURT OF IOWA
No. 137 / 04-1972 Filed June 22, 2007 JEFF SOUTHARD, TRISH SOUTHARD, JEFFREY STICKEL, HEATHER STICKEL, MEL LINT, KEITH GOODYK, and GREG DANA, On Behalf of Themselves and All Others Similarly Situated in the State of Iowa, Appellants, vs. VISA U.S.A. INC. and MASTERCARD INTERNATIONAL INC., Appellees.
Appeal from the Iowa District Court for Dallas County, Darrell J. Goodhue, Judge.
Plaintiff consumers appeal the dismissal of their class action against defendant national bank card associations in which plaintiffs sought recovery based on defendants' alleged violation of Iowa's competition law, Iowa Code ch. 553 (2003), and based on a theory of unjust enrichment. AFFIRMED.
Andrew
B.
Howie
of
Hudson,
Mallaney
&
Shindler,
P.C.,
West Des Moines, for appellants.
Edward W. Remsburg of Ahlers & Cooney, P.C., Des Moines; Robert C. Mason of Arnold & Porter LLP, New York, New York; and Stephen V. Bomse and David M. Goldstein of Heller Ehrman LLP, San Francisco, California, for appellee Visa U.S.A. Inc.
2 Kim J. Walker of Faegre & Benson LLP, Des Moines; Kenneth A. Gallo of Paul, Weiss, Rifkind, Wharton & Garrison LLP, Washington, D.C.; and Gary R. Carney of Paul, Weiss, Rifkind, Wharton & Garrison LLP, New York, New York, for appellee MasterCard International Inc.
3 TERNUS, Chief Justice. The plaintiffs, Jeff Southard, Trish Southard, Jeffrey Stickel, Heather Stickel, Mel Lint, Keith Goodyk, and Greg Dana, filed this class action on September 18, 2003, alleging the defendants, Visa U.S.A. Inc. and MasterCard International Inc., violated Iowa's competition law, Iowa Code chapter 553 (2003). They also sought relief against the defendants on the common-law ground of unjust enrichment. The defendants filed a motion to dismiss the plaintiffs' action on the basis that under well-established, common-law principles the plaintiffs could not recover for derivative or remote injuries. The district court
granted the defendants' motion and dismissed the plaintiffs' petition in its entirety. The plaintiffs appealed. We affirm. I. Standard of Review. We review a ruling on a motion to dismiss for the correction of errors at law. Comes v. Microsoft Corp., 646 N.W.2d 440, 442 (Iowa 2002). A dismissal will be affirmed "only if the petition shows no right of recovery under any state of the facts." Id. A motion to dismiss tests the legal sufficiency of the challenged pleading. Haupt v. Miller, 514 N.W.2d 905, 907 (Iowa 1994). Thus, the motion must stand or fall on the contents of the petition and matters of which the court can take judicial notice. See Leuchtenmacher v. Farm Bureau Mut. Ins. Co., 460 N.W.2d 858, 861 (Iowa 1990). Well-pled facts in the pleading assailed are deemed admitted. Haupt, 514 N.W.2d at 907. In addition, the petition is assessed in the light most favorable to the plaintiffs, and all doubts and ambiguities are resolved in the plaintiffs' favor. State ex rel. Miller v. Philip Morris Inc., 577 N.W.2d 401, 403 (Iowa 1998).
4 "If the viability of a claim is at all debatable, courts should not sustain a motion to dismiss." Muzingo v. St. Luke's Hosp., 518 N.W.2d 776, 777 (Iowa 1994). Although motions to dismiss are not favored, they
continue to be used, particularly when the issue is standing or the capacity to sue. See, e.g., Philip Morris Inc., 577 N.W.2d at 406-07 (affirming
dismissal of State's claims against tobacco manufacturers as too remote and derivative). II. Background Proceedings. The plaintiffs filed a detailed, forty-eight-page petition. In their
petition, they allege they are and they represent consumers who purchased goods for cash or used Visa or MasterCard debit cards to make purchases from merchants who accept Visa or MasterCard credit cards as a form of payment. The plaintiffs contend the defendants required merchants who accepted Visa and MasterCard credit cards to also accept Visa and MasterCard debit cards. Due to this tying arrangement, the plaintiffs
allege, merchants were forced to pay inflated fees for processing debit transactions over the Visa and MasterCard networks. The plaintiffs assert these magnified costs were passed along to all consumers in the form of higher prices for the goods sold by the merchants. The plaintiffs allege the tying arrangement orchestrated by the defendants was a violation of Iowa's competition law. See Iowa Code
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