Iowa Code § 714.16

Section 714.16 permits an attorney general action for an injunction or restoration without proving actual consumer reliance or damages, when a material misrepresentation is made with intent that others rely on it.

State Ex Rel. Miller v. Hydro Mag, Ltd. · filed 1989-05-11(2)(a), (7)

We now hold that reliance and damages are not elements which need to be established in an action for restoration or injunctive relief under Iowa Code section 714.16.

Section 714.16(11) entitles the attorney general to reasonable attorney fees and investigative costs after a successful consumer fraud action, regardless of the defendant’s ability to pay.

State ex rel. Miller v. Fiberlite International, Inc. · filed 1991-10-16(11)

In determining whether a claim for attorney fees and investigative costs under section 714.16(11) is mandatory or discretionary, we need go no further than the language of the act. It provides that “the attorney general is entitled to recover” investigative costs and reasonable attorney fees. We believe it was the intent of the legislature to make these fees and costs an element of the State's recovery in a successful consumer fraud action. It is not a punitive sanction to be imposed or withheld depending upon the defendant’s peculiar financial circumstances.

Section 714.16(2)(a) treats an advertisement as deceptive when the advertiser lacks a reasonable basis for its claim and places the burden on the advertiser to show that a reasonable basis exists.

State Ex Rel. Miller v. National Dietary Research, Inc. · filed 1990-04-18(2)(a)

Iowa Code section 714.16(2)(a) provides that advertisement is deceptive if there is no reasonable basis for the claim made in the advertising. This provision also puts the burden on the party making the representation to show that a reasonable basis for the claim exists.

Section 714.16(1)(g) treats a statement as deceptive if it has the tendency or capacity to mislead a substantial number of consumers about a material fact, even when literally true.

State Ex Rel. Miller v. Rahmani · filed 1991-06-19(1)(g)

Deception is "an act or practice which has the tendency or capacity to mislead a substantial number of consumers as to a material fact or facts." Iowa Code § 714.16(1)(g). Thus, a statement which is literally true may nonetheless be deceptive. ... Here, we are not persuaded that the "Legalities" statement was deceptive. The statement said merely that an effort to comply with the law was being made. Without asserting that the program was legal, this language alerted consumers to the fact that there were potential legal problems involved with the program. The State failed to prove by a preponderance of clear, satisfactory, and convincing evidence that the "Legalities" language was deceptive.

Section 714.16(l)(f) defines an unfair practice as conduct causing substantial, unavoidable consumer injury not outweighed by consumer or competitive benefits, and that definition does not by implication include violations of chapter 82 or the lottery statute.

State Ex Rel. Miller v. Santa Rosa Sales & Marketing · filed 1991-09-18(l)(f)

The term “unfair practice” is defined as “an act or practice which causes substantial, unavoidable injury to consumers that is not outweighed by any consumer or competitive benefits which the practice produces.” Iowa Code § 714.16(l)(f). By using this language, the legislature did not specify that violations of chapter 82 or the lottery statute should be deemed an “unfair practice.” Neither do we believe that we can construe the legislature’s definition of “unfair practice” to include these two misdemeanors by implication.

Section 714.16(1)(f)’s definition of deception applies to consumer fraud, not theft by deception under section 714.1(3).

State v. Ross · filed 1998-01-21(1)(f)

We agree with the State that the general criminal code definition of “deception” in section 702.9 controls here rather than the definition of “deception” in section 714.16(l)(f). This is because the State charged Ross with conspiracy to commit theft by deception in violation of section 714.1(3). The State did not charge Ross with conspiracy to commit a consumer fraud in violation of section 714.16.

Section 714.16 does not prohibit an auction agreement as a matter of law when substantial evidence supports a finding that the auctions were not advertised as unreserved.

IronPlanet, Inc. v. Ritchie Bros. Auctioneers (America) · filed 2014-12-24(2)(a)

That conclusion is not supported by the findings of fact nor can it be established as a matter of law because there is substantial evidence in the record to support the conclusion that IronPlanet did not advertise the Scheckel auctions as unreserved. Therefore, section 714.16 cannot be said to prohibit the IronPlanet-Scheckel agreement as a matter of law.

Section 714.16(2)(a) does not create a private cause of action for consumers to recover for unfair or deceptive practices.

Molo Oil Co. v. River City Ford Truck Sales, Inc. · filed 1998-05-28(2)(a)

Because the statute does not expressly create a private cause of action, the parties agree the question becomes whether a violation of it amounts to perpetration of a crime. ... We held that a violation of this section did not constitute a crime because the statute as finally adopted did not provide punishment for its violation and because of its legislative history. The same grounds and reasoning present, and, we think, demand a similar conclusion here. ... This section expressly creates a cause of action that the legislature did not believe existed as part of the consumer fraud act. Otherwise section 714B.8 would be unnecessary. ... The trial court correctly ruled that no private cause of action is created.

Section 714.16 provides no private right of action under the Iowa Consumer Fraud Act.

In Re Flonase Antitrust Litigation · filed 2010-01-21

Plaintiffs concede in their Response to the Motion to Dismiss that there is no private right of action under the Iowa Consumer Fraud Act, Iowa Code § 714.16, et seq. Therefore, this claim is dismissed.

Section 714.16(3) authorizes the Attorney General to investigate business practices and obtain information, but the resulting administrative inquiry does not itself adjudicate whether those practices violate Iowa law.

Cedar Rapids Cellular Telephone, L.P. v. Miller · filed 2002-02-14(3)

The Attorney General's administrative action, however, involves nothing more than an attempt to obtain information about WWC's business practices. See Iowa Code § 714.16(3)-(6) (Supp. 2001). It is not a judicial proceeding because it does not give the Attorney General, or anyone else, the power to declare whether those practices violate Iowa law. See id.

Section 714.16(3), as part of the investigative provisions in subsections (3)-(6), permits the attorney general to obtain information about business practices but does not authorize the attorney general to adjudicate whether those practices violate Iowa law.

Cedar Rapids Cellular Telephone, L.P. Davenport Cellular Telephone Company, Wwc License, LLC Iowa Wireless… · filed 2002-02-14(3)

The Attorney General's administrative action, however, involves nothing more than an attempt to obtain information about WWC's business practices. See Iowa Code § 714.16(3)-(6) (Supp.2001). It is not a judicial proceeding because it does not give the Attorney General, or anyone else, the power to declare whether those practices violate Iowa law. See id.

Section 714.16(3) lets the Attorney General investigate possible consumer-fraud violations based on his belief that a violation may have occurred, and the statute authorizes investigative demands seeking answers and document production without an objective reasonable-cause showing.

State Ex Rel. Miller v. Smokers Warehouse Corp. · filed 2007-08-03(3), (3)(a)

The Attorney General has authority under the Consumer Fraud Act, Iowa Code section 714.16, to issue a civil investigative demand that includes questions in the nature of civil interrogatories and requests for production. The State’s ability to undertake an investigation of possible consumer fraud upon the Attorney General’s belief that a violation has occurred, as opposed to the existence of reasonable cause to believe a violation has occurred, does not violate substantive due process.

Section 714.16(4)(a) authorizes the attorney general to issue investigative subpoenas to any person and to administer oaths or affirmations, conduct investigative hearings, and prescribe necessary forms and rules.

State of Iowa Ex Rel. Thomas J. Miller, Attorney General of Iowa v. Associated Community Services, Inc. · filed 2014-11-26(4)(a)

The Consumer Fraud Act authorizes the attorney general to issue investigative subpoenas.

Section 714.16(3) gives the attorney general broad investigative powers, and a subpoena recipient must make a demanding showing of undue burden to resist production of relevant information.

State Ex Rel. Miller v. Publishers Clearing House, Inc. · filed 2001-05-31(3)

In this consumer fraud case, as to which the legislature has granted plenary investigative powers to the attorney general, we believe the requirements for showing undue burden should be at least this high.

Section 714.16(7) authorizes restitution for all consumers, including nonresidents, in a consumer-fraud action.

State Ex Rel. Miller v. New Womyn, Inc. · filed 2004-05-12(7)

We conclude that our civil fraud statute provides for restitution on behalf of all consumers, including nonresidents.

Section 714.16(2)(a) can reach post-sale conduct that has a relation or nexus to the sale of merchandise, and it is not limited to sellers.

State Ex Rel. Miller v. CUTTY'S CAMPING · filed 2005-04-01(2)(a)

The Iowa Consumer Fraud Act may regulate post-sale conduct. A trier of fact should decide whether the Club has engaged in an "unfair practice." Nor does the Act only apply to sellers of merchandise.

Section 714.16(7) requires proof of reliance, damages, intent to deceive, and knowledge of falsity only when reimbursement or injunctive relief is sought for a cause of action alleging concealment, suppression, or omission of a material fact.

State of Iowa Ex Rel. Thomas J. Miller, Attorney General for Iowa v. Vertrue, Incorporated F/K/A Memberworks, Inc., a De · filed 2013-07-05(7)

The legislature specifically required proof of the additional common law fraud elements in order to obtain reimbursement for only one distinct unlawful practice—“concealment, suppression, or omission of a material fact.” ... By only listing “concealment, suppression, or omission of a material fact” in section 714.16(7) and excluding the other types of unlawful practices established by section 714.16(2)(a), we think it clear the legislature intended the additional proof elements to apply only to the listed unlawful practice. ... Therefore, the additional common law fraud elements must be proven for causes of action alleging “concealment, suppression, or omission of a material fact.” In turn, the State is not required to prove the additional elements for every violation of section 714.16(2)(a) in any lawsuit that alleges concealment, suppression, or omission of a material fact in addition to other unlawful practices. ... Thus, the most rational, straightforward application of section 714.16(7) only requires the State to prove the additional common law fraud elements in order to obtain reimbursement or injunctive relief on a claim of “concealment, suppression, or omission of a material fact” under section 714.16(2)(a).

Section 714.16(11) permits attorney fees and investigation costs only in a successful consumer fraud action, not merely in a subpoena-enforcement proceeding.

State of Iowa Ex Rel., Thomas J. Miller, Attorney General of Iowa, Applicant-Appellee v. Awakened, Inc., Joshua Weber, a · filed 2017-09-27(11)

Based on our review of the statute and Fiberlite, we conclude a subpoena enforcement proceeding is not an independent “action” under the CFA.

To state a claim under § 714.16(2)(a), a plaintiff must plausibly allege a material misrepresentation made with the intent that others rely on it in connection with the sale of merchandise.

Cota v. Ralph Lauren Corporation · filed 2022-05-19(2)(a)

And under Iowa’s Consumer Fraud Act, Cota would need to plausibly allege that RLC made a misrepresentation of material fact with the intent that others rely upon it in connection with the sale of merchandise. Iowa Code § 714.16(2)(a). As explained above, Cota has failed to plausibly allege that RLC did either of these things. Instead, Cota offers conclusory allegations that unidentified RLC products contained an unspecified amount of pima cotton less than an unspecified amount represented by RLC, all discovered by an unspecified laboratory analysis. This is insufficient to establish “a right to relief above [a] speculative level.” Twombly, 550 U.S. at 555. Therefore, Cota’s WDTPA, ADTPA, and Iowa Consumer Fraud Act claims must be dismissed.

Subsection 714.16(7) requires attorney-general consumer-fraud civil actions to proceed as equitable proceedings without a jury, even when monetary remedies are sought.

State of Iowa, ex rel, Attorney General of Iowa v. Travis Autor, Regenerative Medicine and Anti-Aging Institutes of Omah · filed 2023-05-26(7)

The Code plainly requires “equitable proceedings” for civil CFA actions. Iowa Code § 714.16(7). The Code does not authorize a jury’s involvement in any phase of a civil CFA action. And we do not believe that the constitution prohibits us from enforcing the CFA as written.

Section 714.16(4)(c) does not bar parallel criminal proceedings based on the same transactions when the civil defendants have not yet been questioned and required to give testimony.

State v. Halverson · filed 1985-02-13(4)(c)

Under the facts presented here, Iowa Code section 714.16 constitutes no bar to the commencement of criminal proceedings against these defendants grounded on transactions that also formed the basis of the attorney general's petition.

Section 714.16(2)(a) does not require an intent to deceive or knowledge that a representation is false; it requires only an intent that others rely on the misrepresentation or omission.

State Ex Rel. Miller v. Pace · filed 2004-04-07(2)(a)

Addressing the last argument first, we point out that it is not necessary for the State to prove that the violator acted with an intent to deceive, as is required for common law fraud.

Section 714.16(2)(b) does not automatically prohibit multilevel marketing plans that reward recruitment; it targets profits or rebates derived primarily from recruitment unrelated to retail sales.

State Ex Rel. Miller v. American Professional Marketing, Inc. · filed 1986-02-19(2)(b)

We disagree with the State’s expansive interpretation of the statute. We believe that in enacting section 714.16(2)(b) the legislature intended to prevent the deception present in pyramid plans and referral sales programs, namely, profits or rebates derived primarily from the recruitment of new participants that is unrelated to retailing the product.

Section 714.16(2) does not make a violation a criminal act because it provides no punishment for a violation.

Grinnell Mutual Reinsurance Co. v. Jungling · filed 2002-12-18(2)

To the extent that the court of appeals concluded that the fraudulent acts were criminal acts in violation of Iowa Code section 714.16(2), the court erred. ... We concluded it did not because the statute did not provide punishment for its violation.