Marcus News, Inc v. O'Brien County Board of Supervisors and Iowa Information, Inc.

IN THE SUPREME COURT OF IOWA
No. 18–2096
Filed November 15, 2019
MARCUS NEWS, INC.,
Appellant,
vs.
O’BRIEN COUNTY BOARD OF SUPERVISORS,
Appellee,
and
IOWA INFORMATION, INC.
Intervenor-Appellee.
Appeal from the Iowa District Court for O’Brien County, David A.
Lester, Judge.
Plaintiff appeals decision of the district court affirming designation
of two newspapers owned by intervenor as the official county newspapers
for publication of official proceedings. AFFIRMED.
Ray H. Edgington and Colby M. Lessmann of Vriezelaar, Tigges,
Edgington, Bottaro, Boden & Ross, LLP, Sioux City, for appellant.
Jeff W. Wright and Jacob B. Natwick of Whorley Heidman Law Firm,
L.L.P., Sheldon, for intervenor-appellee.
Keith P. Duffy and Joseph A. Quinn of Nyemaster Goode, P.C.,
Des Moines, for amicus curiae Iowa Newspaper Association.
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APPEL, Justice.
In this case, we consider the meaning of a statute governing the
manner in which county boards of supervisors select official newspapers
for publication of governmental notifications within counties with
populations of less than 15,000 people. The central question in the case
is how to determine whether newspapers under common ownership and
published in the same city can be considered offered for sale or delivered
“in the same geographic area” under Iowa Code section 349.6 (2017).
In this case, the O’Brien County Board of Supervisors (Board)
determined that the Sanborn Pioneer and the O’Brien County’s Bell-Times-
Courier, two newspapers under common ownership and published in the
same city, could not be combined for purposes of determining circulation
because the publications were not offered for sale or delivered in the same
geographic area. As a result of this determination, the newspapers were
not selected as official newspapers for O’Brien County.
The disappointed publications appealed the decision of the Board to
the district court. The district court affirmed, and the publications
appealed. For the reasons expressed below, we affirm.
I. Factual and Procedural Background.
A. Legal Framework. Under Iowa law, the board of supervisors in
a county with less than 15,000 people is required to select two newspapers
for official publications. See Iowa Code §§ 349.1, .3(1). Where more than
two newspapers apply to be an official publication, the matter is deemed a
contested matter and a hearing is held before the board of supervisors. Id.
§ 394.4.
Prior to the hearing, the applicants are required to submit to the
county auditor sealed envelopes containing statements verified by the
applicants. Id. § 349.5. A verified statement must show “the names of the
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applicant’s bona fide yearly subscribers living within the county and the
place at which each such subscriber receives such newspaper, and the
manner of its delivery.” Id.
Once the affidavits are received, the board of supervisors holds its
hearing. The statute requires the board of supervisors to select the two
newspapers based on those with the largest number of bona fide yearly
subscribers. Id. § 349.6. The board determines the bona fide yearly
subscribers of a newspaper based upon those who receive the publication
by mail or otherwise, who have been subscribers “at least six consecutive
months prior to the date of application.” Id. § 349.7(1). Similarly, for
publications regularly delivered by carriers, subscribers are considered
bona fide yearly subscribers if the publication has been delivered “at least
six consecutive months before the date of application.” Id. § 349.7(2).
Finally, when newspapers are purchased for resale by independent
publishers, the subscribers are determined from the independent
publishers list of their subscribers. Id.
Under Iowa Code section 349.6, newspapers under common
ownership and published in the same city are permitted to be combined
for purposes of determining circulation under two circumstances. First,
such newspapers may be combined when the publications have
“approximately the same subscriber list.” Id. In the alternative, however,
such newspapers may be combined for purposes of calculating bona fide
yearly subscribers when “offered for sale in or delivered to the same
geographic area.” Id.
After the board makes its official selection, an applicant may, within
twenty days, appeal the decision of the board to the district court. Id.
§ 349.11. The auditor is directed to “file with the clerk of the district court
a transcript of all the proceedings before the board [of supervisors],
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together with all papers filed in connection with [the] matter.” Id. § 349.12.
The appeal is triable de novo as an equitable proceeding without formal
pleading after twenty days following the filing of the transcript. Id.
§ 349.13.
B. Proceedings Before the Board. Marcus News, Inc. (Marcus
News) publishes two newspapers, the Sanborn Pioneer and the O’Brien
County’s Bell-Times-Courier, in Paullina, Iowa. Similarly, Iowa
Information, Inc. (Iowa Information) publishes two newspapers, the N’West
Iowa REVIEW and the Sheldon Mail-Sun, in Sheldon, Iowa. All four
publications meet the requirements for official publications under Iowa
Code section 618.3.
Marcus News and Iowa Information both submitted applications to
the Board requesting that their newspapers be selected as official county
publications. Marcus News submitted its two newspapers for
consideration as one newspaper under Iowa Code section 349.6. Iowa
Information submitted separate applications for each of their above-listed
newspapers.
On January 7, 2018, Marcus News submitted a combined verified
statement regarding the Sanborn Pioneer and the O’Brien County Bell-
Times-Courier. Id. § 349.5. The following day, Iowa Information submitted
a verified statement regarding the N’West Iowa REVIEW and the Sheldon
Mail-Sun. The statements revealed the following circulation numbers:
Publication Circulation
N’West Iowa REVIEW 1,146
Sheldon Mail Sun 784
O’Brien County’s Bell-Times/
Sanborn Pioneer combined 814
On January 9, the Board held a hearing concerning the applications.
After hearing testimony on behalf of both publishers, the Board first
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awarded the right to legal publication to N’West Iowa REVIEW as the
largest newspaper among the applicants.
The Board next considered whether the newspapers of Marcus
News, the O’Brien County Bell-Times-Courier and the Sanborn Pioneer,
should be considered as one newspaper. The Board concluded that the
two newspapers should not be combined “pursuant to Iowa Code 349.6 as
they are not delivered to the same geographic area and when applying the
split of their subscribers . . . they do not exceed the 784 subscribers of the
Sheldon Mail-Sun.” As a result, the Board awarded its second right-to-
legal publication to the Sheldon Mail-Sun.
C. Proceedings Before the District Court. Marcus News timely
appealed the decision of the Board to the district court, and Iowa
Information intervened. The parties presented to the district court a joint
stipulation of facts with nine attached exhibits. Marcus News raised two
issues before the district court. First, Marcus News argued that its two
newspapers should be treated as one newspaper under Iowa Code section
349.6. Further, Marcus News argued that a considerable number of the
subscribers listed on Iowa Information’s verified statement submitted to
the Board did not meet the statutory requirement of yearly subscribers but
instead included subscribers with subscriptions for less than one year.
See id. § 349.5.
Iowa Information argued that each of the newspapers published by
both Marcus News and Iowa Information should be considered separately.
With respect to the yearly subscriber issue, Iowa Information asserted that
the durations on [the verified statement] merely show the
length of a subscriber’s renewal term. All subscribers in
question were subscribers immediately before their renewal
term . . . began and all renewed their subscriptions for an
additional six months.
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Marcus news responded that these alleged facts were not included in the
joint stipulation of facts and that they should not be considered by the
court.
The district court entered its ruling and order on October 10, 2018.
The district court affirmed the decision of the Board to consider the
Sanborn Pioneer and the O’Brien County Bell-Times-Courier as separate
newspapers under Iowa Code section 349.6. Additionally, the district
court affirmed the Board’s designation of the N’West Iowa REVIEW and the
Sheldon Mail-Sun as the official newspapers for O’Brien County.
On October 24, Marcus News filed a motion to reconsider. Marcus
News asserted that the district court failed to provide proper guidance to
the term “same geographic area,” failed to give proper consideration to the
area in which the Marcus News’ publications circulated, failed to properly
identify the single area in which Iowa Information’s publications were
circulated, failed to consider the legislative intent for the relevant statutes,
and failed to address the fact that the subscriber lists provided by Iowa
Information did not consist wholly of bona fide yearly subscribers.
On November 28, the district court denied the motion for
reconsideration. The district court rejected all the issues raised on the
merits except the question of whether the subscriber lists of Iowa
Information complied with the Iowa Code requirements for verified lists.
According to the district court, the argument was not properly raised at
the time of trial and thus would not be considered further.
Marcus News filed a timely appeal.
II. Standard of Review.
Under Iowa Code section 349.13, the appeal is “triable de novo as
an equitable action without formal proceedings.” As an appeal of an
equitable proceeding, our review is de novo. State ex rel. Miller v. Vertrue,
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Inc., 834 N.W.2d 12, 20 (Iowa 2013); Sille v. Shaffer, 297 N.W.2d 379, 381
(Iowa 1980).
III. Discussion.
A. Proper Interpretation of “Offered for Sale in or Delivered to
the Same Geographic Area.”
1. Introduction. The first question raised in this appeal is the
meaning of the phrase “offered for sale in or delivered to the same
geographic area” in Iowa Code section 349.6. This provision was added to
Iowa Code chapter 349 in 1986. See 1986 Iowa Acts ch. 1013, §§ 1–2
(codified at Iowa Code § 349.6 (1987)). Although there have been no
appellate court decision under this particular section, this court generally
described the purpose of chapter 349 as “to secure as large a general
circulation of the official publications of the county among its citizens as
is practicable.” Albia Publ’g Co. v. Klobnak, 434 N.W.2d 636, 638 (Iowa
1989) (quoting Ashton v. Story, 96 Iowa 197, 201, 64 N.W. 804, 805
(1895)). 1
2. Positions of the parties. First, Marcus News claims the district
court erred in affirming the Board’s decision not to combine the Sanborn
Pioneer and the O’Brien County’s Bell-Times-Courier as one publication
being “offered for sale or delivered to the same geographic area.” According
to Marcus News, the entire county of O’Brien should be considered as the
1Albiawas decided near the adoption of the new language in Iowa Code section
349.6 and included the following footnote:
We recognize that the Iowa legislature has recently amended chapter 349
to provide that in case of a contest under section 349.6, “newspapers
under common ownership published in the same city, and having
approximately the same subscriber list . . . shall be treated as one
newspaper.” 86 Iowa Acts ch. 1013, § 1. Thus our rule would apply only
where no contest exists, as in the case before us.
Albia Publ’g Co., 434 N.W.2d at 639 n.1.
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geographic area in question for the purposes of Iowa Code section 349.6.
Marcus News argues that for other purposes, geographic areas typically
have been analyzed in terms of specific areas with established boundaries.
Cf. City of Postville v. Upper Explorerland Reg’l Planning Comm’n, 834
N.W.2d 1, 11 (Iowa 2013) (finding publication having subscriptions in all
but one county of the five-county region met statutory requirement of
publication within the geographic area served by the board). In the
alternative, Marcus News claims its papers circulated primarily in a
geographic area west of Highway 59 in O’Brien County, rejecting the
district court’s north–south delineation in favor of an east–west delineation
of their own creation.
Second, Marcus News argues that the district court erred in
declining to combine Iowa Information’s publications, the N’West Iowa
REVIEW and the Sheldon Mail-Sun. Marcus News notes that forty-two
percent of the subscribers of the N’West Iowa REVIEW resided in the City
of Sheldon, while eighty-seven percent of the subscribers of the Sheldon
Mail-Sun lived in the City of Sheldon. Marcus News argues that these two
newspapers thus should be treated as published for the same geographic
area and, as a result, should be combined and treated as one publication.
3. Discussion. We begin by considering whether the two
publications of Marcus News should have been considered as one
publication under Iowa Code section 349.6. The parties agree that the key
question is whether the Sanborn Pioneer and the O’Brien County’s Bell-
Times-Courier serve the same geographic area, since their combination
would allow either the highest circulated Marcus News publication, or in
the alternative the combined Marcus News publications, the default
second official newspaper of O’Brien County.
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Exhibits 1 and 2 submitted by the parties in the district court reveal
that ninety-four percent of the subscribers to the Sanborn Pioneer are
located in the northern part of O’Brien County and ninety-two percent of
the subscribers to the O’Brien County’s Bell-Times-Courier are located in
the southern part of O’Brien County. The location of subscribers strongly
suggest that these two papers serve different geographic areas.
We do not agree, as suggested by Marcus News, that the entirety of
O’Brien County is the relevant geographic area. It may be possible, as a
matter of fact, that two publications could be undifferentiated,
homogenous publications with subscribers equally distributed across the
county. That is clearly not the case here. The subscribers to the Sanborn
Pioneer and the O’Brien County’s Bell-Times-Courier are not equally
distributed throughout O’Brien County. The subscriber lists demonstrate
they serve different geographic areas.
A second approach is to suggest the term “same geographic area” in
Iowa Code section 349.6 requires, as a matter of law, a countywide
analysis regardless of the distribution of subscribers within the county.
Such an approach is certainly plausible in the abstract. But if the
legislature intended that result, it would have said so. It would have been
easy for the legislature to state simply that two newspapers, in order to be
combined, need only have subscribers in the same county. That is not
what the legislature did. Instead, in order to be combined (at least when
the subscribers are not approximately the same), Iowa Code section 349.6
provides that the publications must serve the “same geographic area.”
We recognize that Marcus News advances policy arguments
suggesting that its approach to the statute might provide more or better
notice of official actions to the citizens of O’Brien County than the
approach adopted by the district court. The legislature, however, has
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chosen to impose a same-geographic-area requirement for combining
publications. We see no basis to write this requirement out of the statute.
We now turn to the second question posed by Marcus News: namely,
whether the Board should have combined the two publications of Iowa
Information, the N’West Iowa REVIEW and the Sheldon Mail-Sun, for
purposes of Iowa Code section 349.6. The record reveals that eighty-seven
percent of the subscribers of the Sheldon Mail-Sun are located in the City
of Sheldon, while with respect to the multicounty N’West Iowa REVIEW,
fifty-eight percent are located outside of the City of Sheldon. While the
term “same geographic area” does not require exact or total overlap of
subscribers, it does require such a great overlap that the two publications
should be considered as one. Here, the N’West Iowa REVIEW has a
majority of subscribers outside of the City of Sheldon while the vast
majority of the Sheldon Mail-Sun are within the City of Sheldon. Because
of this substantial difference, we do not believe the two publications should
be combined and considered as one publication in the same geographic
area.
B. Yearly Subscriber Issue.
1. Introduction. The record in this case includes three verified
statements (affidavits) that the parties filed with the county auditor
pursuant to Iowa Code section 349.5. 2 The publisher of the Sanborn
Pioneer and the O’Brien County’s Bell-Times-Courier filed an affidavit
combining the subscribers of both publications. The publisher of the
Sheldon Mail-Sun and the N’West Iowa REVIEW submitted separate
affidavits. In each affidavit, the publisher swore that an attached list of
2Although not attached to the parties’ stipulation of facts, the affidavits were filed
with the district court, discussed by the parties at the hearing before the district court,
and included in the appendix in this appeal.
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subscribers “lists the names of the bona fide yearly subscribers living
within O’Brien County, Iowa,” as required by Iowa Code section 349.5.
Further, the publishers swore that “these subscribers have been
subscribers to this same newspaper for at least six months prior to the
date of this application and that they otherwise meet the requirement of
[Iowa Code] Section 349.5 defining bona fide yearly subscribers.”
Two additional exhibits were presented to the district court. Exhibit
8 was a listing provided by Marcus News of subscribers identified in the
affidavit it submitted to the Board with details regarding each
subscription. All of the subscriptions in exhibit 8 had a duration of twelve
months as that is the only subscription period offered by Marcus News’
publications.
Exhibit 9 was a listing of subscribers identified by Iowa Information
in their affidavit submitted to the Board. Unlike the subscribers in exhibit
8, some of the subscriptions in exhibit 9 are for less than one year.
Under Iowa Code section 349.7, the board of supervisors is to
determine bona fide yearly subscribers of a newspaper within the county.
For publications delivered “by mail or otherwise,” a person who has been
a subscriber “at least six consecutive months prior to date of application”
is considered a “yearly subscriber” under the statute. Iowa Code
§ 349.7(1). The statute provides similar language with respect to carrier
subscriptions or papers purchased for resale and delivery by independent
carriers who have filed with the publisher a list of its subscribers. Id.
§ 349.7(2).
2. Positions of the parties. Marcus News emphasizes that the
subscriber list it provided to the Board contained only “yearly subscribers,
all of whom were subscribers for at least six consecutive months prior to
the date of the application [to] the Board as required under [Iowa Code]
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§§ 349.6 and 349.7.” In contrast, Marcus News argues that the subscriber
list of Iowa Information contained “a considerable number of subscribers
. . . who were not yearly subscribers for at least six consecutive months
prior to the date of the application to the Board as required under [Iowa
Code] §§ 349.6 and 349.7.” Specifically, Marcus News identified twenty-
eight subscribers of the Sheldon Mail-Sun and thirty-seven subscribers of
the N’West Iowa REVIEW that had less than one-year subscriptions for a
combined total of sixty-five subscribers. As a result, Marcus News
asserted that a total of sixty-five subscribers did not qualify under the
statute. Marcus News uses this analysis as a springboard to question the
credibility of the numbers submitted by Iowa Information generally.
According to Marcus News,
there could be other questions about [Iowa Information’s] list
if it were looked at more closely, and those questions would
be possibly prompted by the fact that it really hasn’t provided
a truthful representation of the nature of its subscriptions.
In reply, Iowa Information asserts that the term of renewal is not the
same as length of subscription. Although some of the renewal terms were
for periods of time shorter than a year, the shorter renewal term did not
establish that the subscribers had not been subscribers for at least six
months through multiple renewals. As a result, the few cases involving
shorter renewal periods does not undermine the affidavits filed by Iowa
Information listing the number of subscribers who had received the paper
for a six-month period. Further, Iowa Information stated that even if the
sixty-five contested subscribers identified by Marcus News were removed
from the subscription lists, the outcome of the case would not be affected,
as the lowest circulating newspaper published by Iowa Information would
still exceed the highest circulating newspaper published by Marcus News.
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3. Discussion. The district court held that the yearly subscription
issue was not raised before the district court and denied a motion for
reconsideration on the issue. Yet, the transcript of the hearing before the
district court shows that Marcus News raised the issue in its trial brief, in
oral arguments, and again in its motion for reconsideration. There is,
however, still a question of whether the district court had jurisdiction to
hear the yearly subscription issue.
In Ashton, the court noted under a precursor statute that when
fraud is charged, it should be alleged before the hearing is had and the
selection of papers made. 96 Iowa at 198, 64 N.W. at 804. The Ashton
court emphasized that the jurisdiction of the district court is appellate and
that it should try and decide the case made before the board of
supervisors. Id. The minutes and the transcript of the hearing before the
Board in the case at hand make no mention of a challenge to the number
of yearly subscribers claimed by Iowa Information publications.
However, in Dunham v. Clayton County, the court of appeals held
that while Ashton may have been good law at the time it was decided, the
relevant Code section has been amended to provide for appeals to be
“triable de novo as an equitable action.” 470 N.W.2d 362, 366 (Iowa Ct.
App. 1991) (quoting Iowa Code § 349.13 (1985)). The court of appeals
concluded that “trial de novo” in the amended statute was more expansive
than “review de novo” and permitted new evidence and new theories to be
presented to the district court. Id. at 366–67 (quoting Sieg v. Civil Serv.
Comm’n, 342 N.W.2d 824, 828 (Iowa 1983)). In this case, the trial court
and the parties adopted an expansive view of the proceedings, with the
parties engaging in discovery and presenting the district court with
additional exhibits beyond the record developed before the Board. We
adhere to the interpretation of trial de novo adopted by the court of appeals
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in Dunham as the correct view of the current statute. See Dolan v. Civil
Serv. Comm’n, 634 N.W.2d 657, 662–63 (Iowa 2001).
Turning to the merits of the yearly subscriber issue, however, we
conclude that Marcus News is not entitled to relief based upon this claim.
It may be true that some of the renewal terms of subscribers were relatively
short, but short renewal terms do not mean that the listed subscribers
were not subscribers who received the publications for at least six
consecutive months as stated by Iowa Information in the affidavits filed
with the county auditor. The challenge of Marcus News to sixty-five Iowa
Information subscribers, even if upheld, would not be sufficient to alter
the result here, as the largest Marcus News publication would still have
fewer subscribers than the smallest Iowa Information paper. As a result,
we find that Marcus News is not entitled to relief on this ground.
IV. Conclusion.
For the above reasons, the judgment of the district court is affirmed.
AFFIRMED.