IN THE SUPREME COURT OF IOWA

No. 19–0514 

Submitted January 20, 2021—Filed June 25, 2021 

Amended September 30, 2021 

PSFS 3 CORPORATION,

Appellee, 

vs. 

MICHAEL P. SEIDMAN, D.D.S., P.C., d/b/a DENTAL ASSOCIATES OF 

CAPE COD and MICHAEL P. SEIDMAN, Individually, et al., 

Appellants. 

Appeal from the Iowa District Court for Polk County, Scott D. 

Rosenberg, Judge. 

Nearly 300 optometrists and dentists, consolidated into two cases, 

appeal the district court’s rulings on common and specific issues of 

personal jurisdiction and the legality of contract terms, as well as the entry 

of judgment of damages against each defendant without individual trials 

on the issue of damages in violation of the defendants’ due process rights. 

AFFIRMED.

Appel, J., delivered the opinion of the court, in which all justices 

joined. 

Ronald P. Gossett (argued) of Gossett & Gossett, P.A., Hollywood, 

Florida, and Billy J. Mallory of Brick Gentry, P.C., West Des Moines, for 

Gossett appellants. 
2 

David H. Charlip of Charlip Law Group, LC, Miami, Florida, and 

Matthew L. Preston (argued), Brad J. Brady, and Cara L. Roberts of Brady 

Preston Gronlund PC, Cedar Rapids, for Charlip appellants. 

Benjamin P. Roach and Randall D. Armentrout (argued) of 

Nyemaster Goode, P.C., Des Moines, for appellee. 
3 

APPEL, Justice. 

In this case, hundreds of optometrists, dentists, and their 

professional associations appeal from money judgments entered in Polk 

County District Court in favor of an Iowa corporation arising from finance 

agreements related to the purchase from a third-party vendor of 

multimedia systems for their waiting rooms. After consolidating the cases 

and trying two bellwether actions, the district court found that the finance 

agreements were enforceable and entered a judgment for damages against 

each bellwether defendant using a formula for damages presented by the 

plaintiff. The district court then applied the damages formula against the 

remaining defendants based upon proposed orders submitted by the 

plaintiff finance company which provided individual calculations of the 

amounts owed by each defendant. 

The defendants appeal. They raise a wide variety of substantive and 

procedural challenges including questions related to personal jurisdiction, 

the application of a floating forum-selection clause to the case, the proper 

measure and approach to damages, the application of various provisions 

of Iowa Code chapter 535 (2009) to the agreements in this case, the 

imposition of an 18% default rate alleged to be unconscionable under the 

facts and circumstances, and the orders finding the defendants liable for 

attorney fees. 

For the reasons expressed below, we affirm the rulings and 

judgments of the district court. 

I. Factual and Procedural Background. 

A. Overview of the Underlying Dispute. 

1. The transaction. In the years between 2005 and 2008 or 2009, 

NCMIC Finance Corporation (NCMIC) and the optometrists, dentists, and 

their professional associations entered into finance agreements related to 
4 

the purchase of Exhibeo multimedia systems for their waiting rooms. The 

Exhibeo systems included a computer, monitor, and software. 

The principal place of business of NCMIC is Clive, Iowa. With one 

exception, the material terms of the finance agreements between NCMIC 

and the defendants were identical. They all contained a common “hell-orhigh-water clause,” a floating forum-selection clause, and a default 

provision authorizing acceleration of all future payments and the 

assessment of a default interest rate of 18% interest per annum. 

The vendor of the Exhibeo systems, Brican America, Inc. and later 

Brican America, LLC (Brican), sold these systems by allegedly making 

representations that a third party would purchase enough advertising on 

the systems to cover the finance payments and that if the advertising 

stopped Brican would buy back the systems and assume any remaining 

liability. The advertising payments stopped, but Brican refused to buy 

back the systems. The defendants then stopped making payments to 

NCMIC under the finance agreements. 

2. The litigation. As a result of the dispute, defendants filed several 

putative class actions, two in the United States District Court for the 

Southern District of Florida, one in the United States District Court for the 

District of New Jersey, and one in the United States District Court for the 

Central District of California. In these putative class actions, the 

defendants sought, among other things, a declaration that the finance 

agreements were not enforceable. At about the same time, NCMIC 

assigned its interests in the finance agreements to a newly formed wholly 

owned subsidiary, PSFS 3 Corporation (PSFS 3).1 The assignment allowed 

 

1NCMIC also conducted business under the name Professional Solutions 

Financial Services (PSFS) which should not be confused with the NCMIC subsidiary 

PSFS 3. 
5 

PSFS 3 to invoke a floating forum-selection clause in the finance 

agreements in which the parties agreed that the local courts where the 

headquarters of an assignee are located would have jurisdiction over 

disputes under the finance agreement. After the assignment, PSFS 3 filed 

hundreds of cases against individual defendants in Polk County District 

Court seeking to enforce the terms of the finance agreements. 

With multiple lawsuits in several forums threatening incoherent 

results, the United States Judicial Panel on Multidistrict Litigation (MDL 

Panel) consolidated the federal actions in the Southern District of Florida. 

The litigation against individual defendants in Polk County was stayed 

during the Florida federal court proceedings. After the conclusion of the 

federal court litigation favorable to NCMIC and PSFS 3, the Polk County 

District Court lifted its stay of the enforcement actions in Iowa. 

Following the consolidation of the cases and a series of unsuccessful 

dispositive motions, the parties orally agreed to a stipulation that provided 

that the parties would try two bellwether cases (Busch and Insoft) and that 

“rulings and orders therefrom shall be binding as to all other remaining 

cases filed with similar issues and parties and shall constitute issue 

preclusion.” At the conclusion of the two bellwether trials, the district 

court entered judgment for the plaintiff PSFS 3 and awarded damages in 

each case. 

The plaintiff then moved to enforce the stipulation against the 

remaining defendants, asserting that all factual disputes had been 

resolved. PSFS 3 proposed that it submit individual proposed judgments 

with damages calculations in each individual case along the legal 

principles established in the bellwether cases. The defendants object to 

this procedure, asserting they had a due process right to a trial on the 

issue of damages. The district court, however, adopted the procedure 
6 

proposed by PSFS 3 with respect to the remaining cases by asking PSFS 3 

to submit proposed judgments in the remaining cases but stating it would 

give the defendants “an opportunity to respond.” After receiving no 

resistances, the district court proceeded to enter judgments in the 

hundreds of pending matters. 

3. Issues raised on appeal. In their appeal, the defendants raise 

several claims related to the ability of the Polk County District Court to 

hear the enforcement actions. They claim that because of the rulings in 

the Florida litigation by the Southern District of Florida and by the MDL 

Panel, principles of res judicata prevent PSFS 3 from asserting personal 

jurisdiction of defendants under the floating forum-selection provision. 

Further, aside from their res judicata argument, the defendants claim that 

the Iowa district court lacked personal jurisdiction over the defendants 

because the floating forum-selection provision is unenforceable under the 

facts and circumstances of the case. In particular, the defendants attack 

an assignment of the interests in the financing agreements from NCMIC to 

PSFS 3 for the purpose of triggering a floating forum-selection clause that 

provided for personal jurisdiction in the state of any assignee. 

Second, the defendants raise several specific issues related to 

personal jurisdiction. With respect to eleven defendants, they claim the 

actions were filed before NCMIC assigned the company’s interests in the 

financing agreements to PSFS 3 and that, as a result, the original actions 

were void and cannot support personal jurisdiction against those 

defendants. One group of defendants, Jeff Wineinger and Cedar Park 

Vision Center, P.A., argue on appeal that they have a distinctly different 

finance agreement that has no provision relating to choice of forum, and 

as a result, the claim against them should have been dismissed for want 

of personal jurisdiction. 
7 

Third, the defendants claim that the finance agreements are 

unenforceable because they violate two provisions of Iowa Code chapter 

535. The first provision defendants argue that the plaintiff violated is Iowa 

Code section 535.17(1), which requires that material terms of a 

transaction must be disclosed to the borrower, and that the plaintiff failed 

to disclose the interest rate the defendants were being charged in the 

financing transaction. The defendants’ second claimed violation of chapter 

535 is that the interest rate in the finance agreement exceeded the rate 

permitted under Iowa’s usury statute provided in Iowa Code section 535.2. 

Fourth, the defendants claim that PSFS 3 failed to prove the fact of 

damages arising from the alleged breaches of the finance agreements. 

They claim that PSFS 3’s basic approach to calculating damages by 

multiplying the number of missed payments times the amount of each 

payment, was flawed. Instead, the defendants argue that the plaintiff was 

obligated to apportion a part of each payment to principal and interest and 

make calculations of damages based on these key factors. 

Fifth, the defendants claim that the district court’s approach to the 

damages issues in the case violated due process. They claim that they did 

not have an opportunity in the litigation to contest on an individualized 

basis the number of payments that were not paid by an individual 

defendant. They also claim that final judgments were made against 

seventy-three parties, who were not signors of any finance agreement, 

without an opportunity to litigate whether they were a proper party to the 

proceedings. 

Sixth, the defendants claim that the 18% default interest rate in the 

finance agreements is unconscionable. They claim the high rate of interest 

amounts to an unjustified penalty and cannot be enforced. 
8 

Seventh, the defendants seek to preemptively attack any award of 

attorney fees to the plaintiff in these cases. 

B. Commencement of Litigation in Iowa and Florida Regarding 

Enforceability of Finance Agreements. 

1. Initial Iowa enforcement actions brought by NCMIC. NCMIC filed 

several enforcement actions in Polk County District Court in late 2009 and 

early 2010. NCMIC filed its first enforcement action on December 18, 

2009. Additional cases were filed on March 16, 2010, against other 

defendants. 

In the initial Iowa enforcement actions, NCMIC alleged that each 

party: 

[A]greed to personal jurisdiction and venue in any State or 

Federal Court located where the assignee[’]s corporate 

headquarters is located. The corporate headquarters of the 

Plaintiff is located in Clive, Polk County, Iowa. The Iowa 

District Court in Polk County is therefore the proper court in 

which to bring this action under the forum selection clause 

contained in the lease agreement. 

A copy of the finance agreement was attached to each petition. The 

forum-selection clause in Paragraph 13 of the finance agreement stated: 

13. GOVERNING LAW, CONSENT TO JURISDICTION 

AND VENUE OF LITIGATION. This Lease and each Schedule 

shall be governed by the internal laws for the state in which 

Lessor’s or Lessor’s assignee’s principal corporate offices are 

located. IF THIS IS ASSIGNED, YOU AGREE THAT ANY 

DISPUTE ARISING UNDER OR RELATED TO THIS LEASE 

WILL BE ADJUDICATED IN THE FEDERAL OR STATE 

COURT WHERE THE ASSIGNEE’S CORPORATE 

HEADQUARTERS IS LOCATED AND WILL BE GOVERNED BY 

THE LAW OF THAT STATE. YOU HEREBY CONSENT TO 

PERSONAL JURISDICTION AND VENUE IN THAT COURT 

AND WAIVE ANY RIGHT TO TRANSFER VENUE. 

Paragraph 13 has been described as a “floating forum selection 

clause.” The proper forum for disputes among the parties to the finance 

agreement “floats” with each assignment of the interests to the courts 
9 

where the assignee’s headquarters are located. While the forum-selection 

clause expressly stated that disputes would be adjudicated in the state 

where an assignee’s corporate headquarters are located, it did not 

expressly address jurisdiction with respect to disputes involving the 

original party, NCMIC. 

2. Putative class actions filed in Florida attacking the validity of 

finance agreements. While enforcement actions were commenced in Iowa 

by NCMIC, two groups of doctors filed actions in Florida challenging the 

enforceability of the finance agreements. On March 3, 2010, a group of 

doctors represented by attorney David Charlip filed a putative class action 

in Florida state court seeking to void the finance agreements. On 

March 16, doctors represented by attorney Ronald Gossett filed an action 

in federal court in Florida seeking to have the finance agreements declared 

unenforceable. The simultaneous filings in Iowa and Florida set up a 

procedural battle regarding the proper forum for the adjudication of the 

underlying claims. 

3. NCMIC forms PSFS 3 and assigns interests in the finance 

agreements. After the filing of the Florida litigation, an unnamed attorney 

questioned the applicability of the floating forum-selection clause in what 

NCMIC saw as an attempt to stop Iowa-based enforcement efforts. In 

response, NCMIC took steps to address the omission in Paragraph 13 of 

the finance agreement. Counsel for NCMIC recommended that the 

agreements be assigned to another Iowa corporation because under 

Paragraph 13, it “is very clear that jurisdiction and venue [are] proper in 

the home state and county of any assignee.” Thus, according to NCMIC 

counsel, “if these leases are assigned to an Iowa corporation located in 

Polk County we have a lock on jurisdiction and venue here in Polk County.” 

When NCMIC wrote its lender seeking consent to the assignment, it 
10 

advised: “It is important we deal with the possible venue challenge issue 

immediately in order to thwart the need to potentially litigate defaulted 

lease contracts outside of Iowa.” 

On March 30, NCMIC created a new entity, PSFS 3. The same day, 

NCMIC assigned its lease contract rights to the new corporation. The 

apparent purpose of the assignment was to create a “lock” on personal 

jurisdiction in Polk County with respect to enforcement actions filed by 

PSFS 3, the assignee of NCMIC. After the assignment, PSFS 3 filed 

numerous additional enforcement actions in Polk County District Court. 

PSFS 3 also filed amended petitions in cases filed before March 30. 

In the amended petitions, PSFS 3 was substituted as the “real party in 

interest” by “virtue of the assignment.” Service was made on the 

defendants by ordinary mail. 

4. Preliminary skirmishes over forum in Iowa. Defendants filed 

motions to dismiss the Iowa enforcement actions based upon lack of 

personal jurisdiction, lack of venue, and forum non conveniens. The first 

such motion, submitted by defendant Porter, was heard by the district 

court on May 25. The Porter case involved a transaction where Brican was 

the original party to the finance agreement but assigned its interest to 

PSFS. The district court limited its consideration in the motion to the 

question of whether the floating forum-selection clause in the finance 

agreement was enforceable. On June 4, the district court entered an order 

concluding that the floating forum-selection clause was permissive but 

once PSFS 3 chose to file in its home forum, the purchaser waived the 

right to seek to transfer the action to another court. As a result, the motion 

to dismiss was denied. The district court, however, agreed to stay the 

matter pending resolution of the Florida litigation. 
11 

Other defendants filed motions to dismiss with broader arguments 

than those considered in the Porter case. Some defendants claimed that 

the assignment of a category of leases referred to as the “three column” 

leases to PSFS 3 occurred after the actions were filed and thus were not 

applicable to their lawsuits.2 The defendants further claimed that the 

floating forum-selection clause did not apply because it became applicable 

only through a “sham” transaction designed solely to engage in forumshopping after the filing of litigation in Florida and other states. The 

defendants also claimed that the floating forum-selection clause was 

unenforceable because it was unreasonable and unjust. The defendants 

also invoked the doctrine of forum non conveniens, claiming that Florida 

was a more convenient forum for the parties than Iowa. In the alternative, 

the defendants asked for a stay of the action pending resolution of the 

Florida class action. 

PSFS 3 filed a resistance to the motions to dismiss. PSFS 3 

defended the assignment of the contracts from NCMIC to PSFS 3 as 

perfectly valid and not the product of a sham transaction. It asserted that 

the floating forum-selection clause was not unreasonable under all the 

circumstances. 

Attached to the PSFS 3 resistance was an affidavit from Patrick 

McNerney, CEO of NCMIC, along with various supporting documents. 

McNerney reviewed the creation of PSFS 3 and the assignment by NCMIC 

of contracts to the newly created PSFS 3. He attached the assignment 

documentation, articles of incorporation of PSFS 3, security agreement, 

 

2There were two principal forms of financing agreements in the Florida litigation. 

The first type, referred to as the full page format, involved doctors signing agreements 

with Brican as the original financing entity and Brican assigning the agreements to PSFS 

(NCMIC). The second type, referred to as the three column agreements, involved doctors 

signing agreements with PSFS (NCMIC) as the original financing entity that were later 

assigned to PSFS 3 on March 30, 2010. 
12 

certificate of incorporation, and bylaws of the new corporation. He stated 

that PSFS 3 is a wholly owned subsidiary of NCMIC and was capitalized 

with $500,000 in cash. 

The district court held a hearing on the motions to dismiss on 

July 9. At the hearing, the Gossett defendants, pursuant to Iowa Rule of 

Civil Procedure 1.431(6), requested the opportunity to cross-examine 

McNerney, who did not appear for the hearing. 

At the hearing, the parties asked the court to consolidate the 

individual actions. On July 22, the district court entered an order 

consolidating the cases pursuant to Iowa Rule of Civil Procedure 1.913. 

The district court stated that while the consolidation remained in place, 

“any rulings which may be forthcoming . . . shall be considered as having 

been individually filed in each of the [consolidated] cases.” 

On August 12, the district court ruled on the pending motions to 

dismiss. The district court denied the motions. With respect to the BricanPSFS leases, the district court reaffirmed its prior ruling in the Porter

action. The district court further addressed an issue not decided in Porter, 

namely, whether the interest being assigned was sufficiently identified in 

the Brican-PSFS documents. The district court concluded that they were. 

On the question of the validity of the assignment of interests in the 

finance agreements by NCMIC to PSFS 3, the district court held that the 

assignment was valid. In rejecting the claim that the assignment was a 

sham, the district court relied extensively on the McNerney affidavit and 

accompanying documents. The district court noted: “These documents 

persuasively make the case that PSFS 3 is a separate corporate entity, 

properly capitalized and which receives the benefit of the monthly lease 

payments called for under the assignments in question.” 
13 

The district court further concluded that the language of the floating 

forum-selection clause created mandatory jurisdiction in Iowa. Further, 

the district court concluded that under Iowa law, a floating forum-selection 

provision was enforceable unless “unreasonable or unjust” or invalid for a 

reason such as fraud or overreaching. On the record made, the district 

court concluded that the defendants failed to make such a showing. 

After the district court’s August 12 ruling, the parties engaged in 

discovery on the assignment issue. The defendants obtained financial 

records and organizational documents related to PSFS 3. On January 12, 

2011, the defendants also deposed McNerney. 

After conducting the discovery, on January 24, the defendants again 

moved to dismiss the actions. The defendants emphasized what was 

uncovered in the deposition of McNerney. According to the defendants, on 

the expense side of the ledger, the deposition established that PSFS 3 paid 

no fees for incorporating, paid no compensation to anyone, had no paid 

employees, paid no rental for any offices, paid no telephone bills, paid no 

electrical bills, purchased no office supplies, purchased no paper, nor paid 

for business cards. The only expenses of PSFS 3 were a payment for bank 

service charges and an unexplained payment of $264.94 to NCMIC. 

On the questions of capitalization and income, the defendants noted 

that the deposition of McNerney revealed that although the company was 

formed on March 30, 2010, money was not deposited in any PSFS 3 bank 

account until May 14 when $500,000 was deposited. Further, in terms of 

income, NCMIC deposited amounts monthly into PSFS 3’s bank account, 

and then PSFS 3 immediately transferred the exact same amount back to 

NCMIC. 

PSFS 3 resisted dismissal and filed a supplemental affidavit from 

McNerney. PSFS 3 addressed the challenge to the assignment of the three 
14 

column leases to PSFS 3. Among other things, PSFS 3 noted that it was 

common for wholly owned subsidiaries to rely on employees of the parent 

and to share common space with a parent. PSFS 3 noted that it signed a 

$13,500,000 promissory note with NCMIC as compensation for the 

assignment of the three column leases. PSFS 3 further noted that 

$500,000 in capital was transferred on March 31, on to the general ledger 

of the new corporation and deposited into a PSFS 3 account once Wells 

Fargo Bank completed the necessary internal activities to activate the 

account. 

On March 3, 2011, the district court again denied the motion to 

dismiss. The district court stated it had carefully reviewed the McNerney 

testimony. The district court, however, concluded that while the plaintiff 

may have gone to great lengths to create an assignment which would form 

the basis for the use of the floating forum-selection clause, the defendants 

“have not convinced the court that this underlying assignment is 

fraudulent or otherwise a ‘sham.’ ” The district court, however, agreed to 

the defendants’ motion to stay the three column proceedings pending 

developments in the Florida litigation. 

5. Preliminary skirmishes in Florida over forum. On May 5, 2010, 

NCMIC (PSFS) filed a motion to dismiss the Florida federal court action or 

to transfer it to the Polk County District Court. The federal district court 

denied the motion on several grounds. First, the district court observed 

that the floating forum-selection clause was permissive, not mandatory. 

Second, the district court noted that the putative class action was filed 

prior to the assignment of finance agreements in the case and thus “it 

would be inequitable to allow Defendants to shop the actions to another 

forum simply by assigning the Leases after the lawsuit [was] filed.” Finally, 

the district court noted that the MDL Panel had expended resources and 
15 

decided that the actions were “triggered belatedly for the purposes of forum 

shopping.” 

After similar actions against NCMIC were filed in other federal 

district courts, the Charlip and Gossett defendants filed a motion with the 

MDL Panel to transfer all similar actions to the Southern District of 

Florida. NCMIC and PSFS 3 responded to the motion, arguing that Florida 

was an improper venue because the leases contained the floating forumselection clauses which would require the claims to be litigated in Iowa. 

The MDL Panel transferred the cases to the Southern District of Florida, 

stating “[w]e are persuaded that the Southern District of Florida is an 

appropriate . . . forum.” 

C. Conclusion of Federal Court Litigation in Florida. The 

litigation in Florida proceeded to resolution. In a series of rulings, the 

federal district court proceeded to winnow the claims through summary 

judgment proceedings. On August 1, 2013, the district court ruled that 

under the finance agreement, the cancellation provision did not invalidate 

the hell-or-high-water clause of the contracts. On January 22, 2014, the 

district court ruled that to the extent Brican made misrepresentations to 

doctors that it would “ ‘buy back,’ ‘repurchase’ or ‘assume assignment’ of 

the Financing Agreement,” it was not acting as an agent for NCMIC. The 

district court noted, however, that enforcement was subject to “defenses 

unique to individual plaintiffs that were not and could not have been 

asserted within the scope of the common questions of law or fact presented 

in this action.” 

On May 7, 2015, the district court entered final judgments in the 

cases involving three column leases. The doctors appealed. On 

November 22, 2016, the United States District Court for the Eleventh 

Circuit affirmed. 
16 

D. Iowa Proceedings After the Conclusion of the Florida 

Litigation. 

1. Pretrial proceedings. On January 3, 2017, the Polk County 

District Court lifted the stay on the Iowa cases. A trial was scheduled for 

December 11 for all the cases. The district court ordered the defendants 

to amend their answers to raise any and all affirmative defenses within 

fifteen days of the order. The district court further ordered the parties “to 

select those cases for trial first that have the most common issues as to as 

many parties as possible and proceed there from the most issues to the 

least issues.” 

On March 7, the defendants opted to continue the litigation with two 

large groups of defendants (one group represented by Gossett and the 

other by Charlip). The Gossett defendants filed a consolidated document 

with amended answers and affirmative defenses. The Gossett defendants 

raised fifteen additional affirmative defenses, including: (1) lack of personal 

jurisdiction, (2) violation of Iowa Code section 535.17, and (3) violation of 

Iowa’s usury statute contained in Iowa Code section 535.4. The Gossett 

defendants also counterclaimed for a declaratory judgment that PSFS 3 

waived its right to attorney fees in federal courts by failing to timely file. 

The Charlip defendants filed a similar amended answer and affirmative 

defenses. 

On May 5, PSFS 3 moved for summary judgment. The general 

thrust of the motion was that the federal district court had ruled in favor 

of the enforceability of the finance agreements, subject only to unique 

individualized defenses and that the defendants were precluded from 

relitigating the issues that were brought, or could have been brought, in 

the Florida federal court action. The defendants resisted, noting, among 
17 

other things, that issues unique to individual defendants remained to be 

litigated. 

On August 4, the district court denied the motion. The district court 

found that the defendants did not include certain Iowa law claims in the 

Florida litigation for fear of destroying commonality. Further, the district 

court found that there were genuine issues of material fact on whether the 

material terms of the financing agreements were included in the 

documents, whether the financing agreements violated Iowa usury law by 

not including a rate of interest, whether NCMIC is entitled to default 

interest on future amounts due to accelerating the amount owed, and 

whether NCMIC is entitled to recover attorney fees in the Iowa court for 

fees incurred in the Florida litigation. 

After the denial of the motion, the parties continued discovery. On 

the issue of damages, PSFS 3 answered interrogatories asking how 

damages were calculated and produced records showing the total number 

of payments made by each defendant on their respective finance 

agreements. 

On October 12, PSFS 3 renewed its motion for summary judgment. 

The plaintiff asserted in the second summary motion that the terms of the 

finance agreements complied with Iowa Code chapter 535 and that the 

18% default rate was not unconscionable. Also on October 12, the Gossett 

and Charlip defendants filed a motion for summary judgment on their 

affirmative defenses. They claimed that the failure to disclose the interest 

rate and the interest rate itself violated Iowa Code section 535.17(1) related 

to material disclosures and section 535.2 dealing with usurious rates of 

interest. 

At the hearing on the motions on November 21, the district court did 

not provide a ruling. The district court again urged the defendants to file 
18 

any defenses unique to individual defendants. Specifically, the district 

court noted, “The parties shall raise any and all defenses by December 1, 

2017 or be barred from raising them at any future time.” In response, 

three defendants filed amended answers.3 

2. Trial of bellwether cases. With one exception, the finance 

agreement was identical in all cases.4 On November 21, 2017, the parties 

entered into a stipulation to try two bellwether cases against defendants 

Insoft and Busch: “The parties agree that the two trials on December 11 

and 12, 2017 and the rulings and orders therefrom shall be binding as to 

all other remaining cases filed with similar issues and parties and shall 

constitute issue preclusion.” 

On December 11 and 12, the district court held bench trials in the 

bellwether cases. The parties filed posttrial briefs. On April 9, 2018, the 

district court issued an order entitled “Ruling and Order on Plaintiffs’ and 

Defendants’ Motions for Summary Judgment.” In the ruling, the district 

court held that the finance agreements were enforceable and ordered 

PSFS 3 to submit proposed judgment entries on damages in the bellwether 

cases. The PSFS 3 submission determined the damages by calculating the 

payments that were unpaid under each agreement. PSFS 3 further sought 

default interest, late fees, unpaid taxes, and court costs. 

3. Calculation of damages in bellwether cases. On June 15, 2018, 

the district court entered judgment in the bellwether cases. The Busch 

and Insoft defendants filed a motion to reconsider on June 25. In their 

 

3Andrea Gentile-Fiori and Gary Goberville claimed that their business entities 

should have been sued rather than themselves personally. Jeffrey Mellom challenged the 

signature on the finance agreement that PSFS 3 sought to enforce. 

4Wineinger’s finance agreement did not contain any provision related to forum 

selection. 
19 

motion, the Busch and Insoft defendants attacked the imposition of late 

fees and a court ruling that the plaintiff was entitled to attorney fees. The 

district court disposed of the motion to reconsider on July 1, 2019.5 

4. Entry of judgments against the remaining defendants. On 

May 17, 2018, PSFS 3 moved to enforce the stipulation against the 

remaining defendants and to have judgments entered pursuant to the 

same damages approach employed in the bellwether cases. In support of 

the motion, PSFS 3 submitted a chart showing the remaining payments 

owed by each defendant. On May 30 and May 31, a total of fifty-four 

defendants resisted, arguing, among other things, that without a trial on 

the remaining issues they would be deprived of due process.6 They 

specifically stated that while rulings in the Busch and Insoft cases may be 

preclusive on issues of liability, the plaintiff failed to establish damages in 

the bellwether cases that would be applicable in the other cases. The 

defendants noted that damages calculations based on the number of 

missed payments times the amount of each missed payment would differ 

for each and every defendant. The defendants also suggested that entering 

final orders in the remaining cases should await the outcome of any appeal 

in the bellwether cases. 

On June 6, PSFS 3 filed a reply urging the district court not to stay 

final resolution of the other cases that had already been pending for eight 

years. PSFS 3 argued that all that remained in the individual cases was a 

calculation of damages by multiplying the number of missed payments 

 

5The two bellwether cases have settled and thus those judgments are not subject 

to this appeal. 

6The May 30 filing was on behalf of three Gossett defendants where judgments 

were not entered against them and who are not parties to this appeal. The May 31 filing 

was on behalf of Charlip defendants in 51 individual cases. 
20 

times the amount of each payment and assessing default interest from the 

date of the filing of each petition. 

To the extent there were due process concerns, PSFS 3 asked the 

district court to treat its filing as a motion for summary judgment. PSFS 3 

argued that it had submitted necessary records supported by an affidavit 

to determine damages in each case. Unless the defendants’ resist with 

admissible evidence that established a genuine issue of material fact, the 

district court should proceed to enter judgments in the cases. PSFS 3 

closed by asking the district court to enter judgment in its favor in the 

cases and proposed that it prepare individual judgments as the district 

court might direct. 

On December 14, the district court held a hearing on the pending 

motions. At the hearing, PSFS 3 again asserted that the manner of 

calculating damages had been determined and that there were no 

remaining factual disputes on damages. PSFS 3 noted that it filed its 

materials in May and that none of the defendants contested the damages 

calculations. PSFS 3 suggested that as no responses were filed, the 

district court could treat their submission as a motion for summary 

judgment and issue judgments including damages based on undisputed 

facts. 

The defendants replied that the burden of proving damages in each 

case rested with the plaintiff and that a noncross-examined affidavit could 

not be used to shift the burden to the defendants. The defendants 

emphasized that the PSFS 3 motion to enforce the stipulation was not 

presented as a motion for summary judgment and, as a result, “we didn’t 

go to the individual damage claims.” 

At the conclusion of the December 14 hearing, the district court 

directed PSFS 3 to submit proposed judgment entries as to all the 
21 

remaining defendants. The district court told the parties “I won’t rule on 

the final order judgment until I see what you present and give the 

defendants an opportunity to respond.” PSFS 3 submitted such proposals 

between January 11 and 29, 2019. After the proposed judgments had 

been on file for nearly a month without resistances being filed by the 

defendants, the district court began entering judgments in individual 

cases on February 26 and running through April 8. The defendants filed 

postjudgment motions, but none of them disputed the number of 

remaining payments with respect to any defendant. The district court 

denied the posttrial motions. 

II. Common Issues of Personal Jurisdiction. 

A. Introduction. In this litigation, PSFS 3 relied upon a forumselection clause in its standard finance agreement to establish consent to 

personal jurisdiction in Iowa courts by the defendants. The problem is 

that Paragraph 13 of the finance agreement that related to forum selection 

did not expressly apply to the original contracting parties. The forumselection clause was a floating forum-selection provision that applied only 

in the event of an assignment of the contracts by NCMIC. 

To remedy the lack of explicit consent to an Iowa forum in litigation 

with NCMIC, NCMIC assigned the finance agreements to a wholly owned 

related corporation, PSFS 3. Because of the assignment, PSFS 3 argued 

that the floating forum-selection clause now applied and the district court 

in Polk County had jurisdiction over the cases pursuant to the parties’ 

agreement. The defendants, however, argued that the assignment was a 

sham transaction and that the floating forum-selection clause should not 

be applied under the facts of this case. 

B. Standard of Review. Rulings on questions of personal 

jurisdiction are reviewed for correction of errors at law. Shams v. Hassan, 
22 

829 N.W.2d 848, 853 (Iowa 2013). A motion to dismiss is a special 

proceeding that requires findings of fact and conclusions of law. Cap. 

Promotions L.L.C. v. Don King Prods., Inc., 756 N.W.2d 828, 832–33 (Iowa 

2008). The plaintiff has the burden to set forth a prima facie case that 

jurisdiction is appropriate, with the district court “accept[ing] as true the 

allegations of the petition and the contents of uncontroverted affidavits.” 

Shams, 829 N.W.2d at 853 (quoting Addison Ins. v. Knight, Hoppe, Kurnik 

& Knight, L.L.C., 734 N.W.2d 473, 476 (Iowa 2007)). Once “the plaintiff 

makes a prima facie case . . . , the burden shifts to the defendant to rebut 

that showing.” Id. 

C. Positions of the Parties. 

1. The defendants. Generally, the defendants raise several personal 

jurisdiction arguments that apply to all defendants. First, the defendants 

claim that the assignments made by NCMIC to PSFS 3 were made for 

improper forum-shopping purposes after the commencement of federal 

litigation in Florida. They noted that “the MDL panel rejected PSFS 3’s 

claim to Iowa jurisdiction” and that the federal district court in Florida 

declared that “it would be inequitable to allow Defendants to shop the 

actions to another forum simply by assigning the Leases after the lawsuit 

[was] filed.” The defendants argue that this aspect of the unappealed and 

final Florida district court ruling conclusively binds the Polk County 

District Court through application of res judicata. 

Second, aside from the alleged preclusive effect of the Florida 

litigation, the defendants attack the findings of the district court about the 

nature of the assignments at issue. The district court found that PSFS 3 

is a separate corporate entity, properly capitalized, and received the benefit 

of the monthly lease payments under the assignments. The defendants 

attack the district court’s findings on four fronts. 
23 

With respect to the validity of the assignments, the defendants claim 

that the district court’s conclusion regarding PSFS 3 receiving the benefit 

of monthly lease payments received by PSFS 3 was in error. The 

defendants assert that, in reality, lease payments were originally collected 

by NCMIC as an agent for PSFS 3, transferred to PSFS 3, and then 

transferred back to NCMIC in the exact same amount. The transfer back 

to NCMIC was to pay off a note that PSFS 3 signed with NCMIC to purchase 

the assignment of the finance agreements. In the end, according to the 

defendants, NCMIC has assigned bare legal title to the financing 

agreements to PSFS 3 while keeping the full beneficial interest for itself. 

The sole purpose of the transaction, according to the defendants, was to 

promote NCMIC’s forum-shopping interest. 

Next, the defendants note that the record does not establish that 

PSFS 3 was properly capitalized. PSFS 3 had signed promissory notes to 

NCMIC for $13,000,000 and PSFS 3’s initial capitalization of $500,000 

was made with a promissory note from NCMIC to PSFS 3. The defendants 

claim that these facts do not support a finding of proper capitalization of 

PSFS 3. 

In addition, the defendants assert that PSFS 3 is not really a 

“separate corporate entity.” They note that PSFS 3 is wholly owned by 

NCMIC, “has nothing except an interlocking board of directors and officers, 

and holds bare legal title to the Financing Agreements (whose benefits 

remain flowing to NCMIC) for the sole purpose of triggering a floating forum 

jurisdiction clause.” 

Finally, the defendants assert that the assignment of the financing 

agreements was a sham. The defendants cite Iowa Supreme Court 

Commission on Unauthorized Practice of Law v. A–1 Associates, Ltd., 623 

N.W.2d 803, 808 (Iowa 2001) (en banc), in support of their position. In A–
24 

1 Associates, we determined that a purported assignment of debt to a 

collection agency was a sham transaction to permit the collection agency, 

proceeding pro se, to practice law on the cheap while remitting the balance 

to the original assignor after collecting a fee. Id. According to the 

defendants, counsel for the plaintiff admitted that the purpose of the 

assignment to the new corporation was to provide a “lock” on jurisdiction 

and venue in Polk County. 

Having shown that the transaction was, in fact, a “sham,” the 

defendants claim that NCMIC violated its duty of good faith and fair 

dealing by attempting to use the forum-selection clause not pursuant to a 

valid arm’s length assignment but instead for a forum-shopping purpose. 

In support of its argument, the defendants cite Garcia v. Eidal International 

Corp., 808 F.2d 717, 722 (10th Cir. 1986), and Vista Outdoor Inc. v. Reeves 

Family Trust, 725 Fed. Appx. 17, 21 (2d Cir. 2018). 

2. Position of the plaintiff. On the generally applicable personal 

jurisdiction issues, PSFS 3 asserts that the question in this case is 

whether application of the floating forum-selection provision is unfair, 

unreasonable, or unjust under Iowa caselaw. See Karon v. Elliott Aviation,

937 N.W.2d 334, 346 (Iowa 2020). PSFS 3 notes that the individual 

doctors all contracted with an Iowa company and that the contract would 

be governed by Iowa law. Even in the absence of an assignment, according 

to PSFS 3, the defendants should have expected to be sued in Iowa when 

a dispute arose. Thus, to the extent the forum floated in this case, it did 

not float very far from what the parties should have expected. 

PSFS 3 asserts that the transaction was not a sham transaction but 

instead amounted simply to the creation of a related entity for the purpose 

of “monitoring the receipt of payments . . . and, where necessary, enforcing 

the Financing Agreements in court.” PSFS 3 points out that the entity is 
25 

properly organized under Iowa law, is fully capitalized, has separate books, 

and follows corporate formalities. 

PSFS 3 rejects the effort of the defendants to “pierce the corporate 

veil.” PSFS 3 points out that the pierce the corporate veil doctrine is a 

misnomer and is really a remedial doctrine that permits liability to extend 

to individuals notwithstanding the presence of a corporate structure that 

might ordinarily limit the personal liability of individual owners. In any 

event, PSFS 3 argues there is no sham, and instead, there is transparency. 

The purpose of PSFS 3 is to allow for the consolidation of the finance 

agreements to actions in one forum and to enforce those agreements. It is 

not a case where unlawful or unauthorized activity is masked by an 

organizational structure as in A–1 Associates. 

Finally, PSFS 3 addresses the res judicata issue. According to 

PSFS 3, no court has held that Iowa courts have no personal jurisdiction 

over any defendants in the Iowa cases. Instead, the Florida court 

determined that the floating forum-selection provisions were not 

“mandatory.” As a result, there is no identical issues in the Florida case 

that precludes a finding of personal jurisdiction in the Iowa cases. Emps. 

Mut. Cas. Co. v. Van Haaften, 815 N.W.2d 17, 22 (Iowa 2012). 

D. Discussion. 

1. Res judicata. We first begin with the claim that the Iowa litigation 

is barred by the doctrine of res judicata as a result of the decision of the 

federal district court in Florida. It is true, as the doctors point out, that 

the federal district court rebuffed efforts to have the Florida cases 

transferred to Iowa courts. And, it is true that PSFS 3 did not appeal those 

rulings. 

But, it does not follow that the rulings denying the transfer of cases 

to Iowa amounted to a determination in federal court that Iowa courts 
26 

lacked personal jurisdiction over the doctors. There is nothing in the order 

of the MDL Panel or the Florida district court that takes a position on that 

precise issue. Instead, the rulings declined to take the affirmative step 

requested by PSFS 3, namely, to transfer the pending Florida cases to 

Iowa. That, of course, would defeat the plaintiff’s choice of forum where 

the plaintiff filed its action first. 

Thus, the MDL Panel and the Florida federal district court 

determined that it would be inequitable to transfer the cases to Iowa based 

on the assignment after the doctors’ litigation had already been filed in 

Florida. Nothing more was decided. In order for res judicata to apply, 

however, the issue in the previous litigation must be identical. 

Van Haaften, 815 N.W.2d at 22; Soults Farms, Inc. v. Schafer, 797 N.W.2d 

92, 104 (Iowa 2011). As a result, the action in federal court has no res 

judicata effect on the unaddressed question of whether there was personal 

jurisdiction over the defendants in Polk County, Iowa. 

2. Sham transaction. The defendants argue that the transfer of the 

finance agreements to PSFS 3 was a sham transaction of a kind that 

prevents enforcement of the floating forum-selection provision. But the 

assignment was not a sham. It was a transparent transaction with the 

limited purpose of creating an optimal enforcement mechanism with 

respect to the finance agreements. 

Further, we agree with PSFS 3 that the pierce the corporate veil 

doctrine is not well designed for the context we deal with here. The 

question here is not one of remedy where the corporate structure has been 

abused, but one of compliance with an express contractual term that 

establishes personal jurisdiction in the courts of the state where the 

corporate headquarters of an assignee is located. 
27 

While the defendants urge us to apply a doctrine of good faith and 

fair dealing, we think it does not apply in this context. There is an express 

unqualified contractual provision here authorizing assignment of the 

interest created by the finance agreement. The doctrine of good faith and 

fair dealing “does not ‘give rise to new substantive terms that do not 

otherwise exist in the contract,’ ” let alone override an express contractual 

provision. Bagelmann v. First Nat’l Bank, 823 N.W.2d 18, 34 (Iowa 2012) 

(quoting Mid–Am. Real Est. Co. v. Iowa Realty Co., 406 F.3d 969, 974 (8th 

Cir. 2005)). Further, enforcement of the literal terms of the contract does 

not appear unfair, especially where the original party to the contract was 

headquartered in Clive, Iowa, and the contract expressly declared that the 

law of Iowa applied. The assignment in this case simply cannot be 

considered far afield from the parties’ legitimate expectations. Am. Tower, 

L.P. v. Loc. TV Iowa, L.L.C., 809 N.W.2d 546, 550–51 (Iowa Ct. App. 2011) 

(“Implied contractual duty of good faith and fair dealing in commercial 

contracts does not support an independent cause of action for failure to 

act in good faith under a contract; instead, the duty of good faith is meant 

to give the parties what they would have stipulated for at the time of 

contracting if they could have foreseen all future problems of 

performance.” (quoting 13 Richard A. Lord, Williston on Contracts § 38.15, 

at 24 (4th ed. Supp. 2011))). Personal jurisdiction in an Iowa forum under 

these facts and circumstances certainly cannot be considered unfair, 

unreasonable, or unjust. Karon, 937 N.W.2d at 346. Finally, NCMIC and 

PSFS 3 have not acted in any way that has prevented the defendants from 

performing under the contract or from defending the underlying Iowa 

actions. See Restatement (Second) of Contracts § 205(d), at 99–104 (Am. 

L. Inst. 1981) (citing interference with or failure to cooperate in the other 

party’s performance as violations of good faith and fair dealing). 
28 

III. Defendant-Specific Issues of Personal Jurisdiction. 

A. Introduction. Aside from the common issues of personal 

jurisdiction arising from the assignment of interests in the finance 

agreements to PSFS 3, the defendants on appeal raise two challenges to 

personal jurisdiction specific to individual defendants. 

First, with respect to eleven defendants, the defendants note that 

the actions against them were filed before the March 30, 2010 assignments 

and that at the time of the filing of those actions, there was no basis for 

personal jurisdiction over them in Polk County. The efforts to amend the 

originally filed claims to name PSFS 3 as the real party in interest, 

according to these defendants, was a nullity and the actions should have 

been dismissed. 

Second, with respect to the two Wineinger defendants, they point 

out that they entered into a unique finance agreement with NCMIC that 

had no provision related to venue of any kind. And, as a result, any 

assignment of interest from NCMIC to PSFS 3 was meaningless as to them. 

B. Preassignment Claims Brought by NCMIC. 

1. Overview. Prior to the formation of PSFS 3 on March 30, 2010, 

NCMIC filed actions in Polk County District Court against eleven 

defendants. After the March 30 assignment, the plaintiff amended its 

pleadings to name PSFS 3 as the real party. The district court granted the 

amendments. The only basis for personal jurisdiction asserted in these 

cases by PSFS 3 was the floating forum-selection clause which was 

triggered after the petitions in these cases were filed. 

The individual defendants assert that because the original pleadings 

were filed at a time when there was no personal jurisdiction over the 

defendants, the original filings by NCMIC were a nullity from the 

beginning. Because the original filings were nullities for lack of personal 
29 

jurisdiction when filed, the individual defendants assert they could not be 

later amended to add PSFS 3 as a party and assert personal jurisdiction 

under the floating forum-selection clause. If the original pleadings were a 

nullity, according to these individual defendants, they could not be later 

amended. Further, they claim, the assertion of personal jurisdiction based 

on the original petition is a violation of due process of law.7 

In support of their argument, defendants cite Evans v. Ober, 256 

Iowa 708, 129 N.W.2d 78 (1964). In that case, we found that an original 

notice that indicated the defendant should appear at the Lee County 

courthouse in Fort Madison when the action itself was filed in the Lee 

County courthouse in Keokuk was invalid. Id. at 709–10, 129 N.W.2d at 

79. In Evans, we emphasized that the notice in the case was not merely 

voidable but void. Id. at 711, 129 N.W.2d at 80. 

On appeal, PSFS 3 does not brief the issue. The district court, 

however, rejected the claim. According to the district court, Iowa Rule of 

Civil Procedure 1.201 provides that when an action is initially commenced 

by a party other than the real party in interest, it is not to be dismissed 

“until a reasonable time has been allowed after objection for ratification of 

commencement of the action by . . . the real party in interest.” (Omission 

in original) (quoting Iowa R. Civ. P. 1.201). According to the district court, 

ratification of the prior action occurred when PSFS 3 sought to be 

substituted as the real party in interest in the litigation. The district court 

noted that “[i]t would serve nothing to dismiss any actions filed before the 

creation of PSFS 3, just to have them refiled in an identical pleading postcreation.” The district court cited Hammond v. Florida Asset Financial 

 

7The defendants do not identify whether their claim is brought under the United 

States Constitution or the Iowa Constitution. As a result, we consider the claims 

preserved under both the Federal and State Constitutions. See, e.g., State v. Harrington, 

805 N.W.2d 391, 393 n.3 (Iowa 2011); King v. State, 797 N.W.2d 565, 571 (Iowa 2011). 
30 

Corp., 695 N.W.2d 1, 8 (Iowa 2005), for the proposition that any dismissal 

of the original claims would be without prejudice, implying that there 

would be no barrier to refiling an essentially identical complaint. 

2. Discussion. The preassignment individual defendants raise an 

interesting point, but ultimately their due process claim does not carry the 

day. The point of due process is to ensure that a party is not unfairly 

hauled into a distant forum without either sufficient minimum contacts to 

support personal jurisdiction or consent to jurisdiction in the distant 

forum. Here, the defendants received full notice of the action through the 

original petitions. While there might have been a question of personal 

jurisdiction at that point, the later assignment of the interest in the finance 

agreements from NCMIC to PSFS 3 removed that question. PSFS 3 could 

have been required to file a new original action against the defendants after 

the March 30 assignment, but that would have achieved nothing of 

substance as the defendants had notice of the action and knew that 

personal jurisdiction was being claimed by virtue of the assignment and 

the floating forum-selection clause. Under the circumstances, we think 

the district court’s interpretation of Iowa Rule of Civil Procedure 1.201 as 

permitting the curing of a potential personal jurisdiction issue in a validly 

served original petition by later substitution of a real party in interest did 

not violate due process in this case. The resolution of the issue may not 

approach perfection, but the basic principles of fairness—the heart of due 

process—have not been offended here under the facts of the case. 

C. Wineinger Defendants’ Claims. Defendants Cedar Park Vision 

Center, P.A. and Jeff Wineinger (Wineinger defendants) have a unique 

claim related to personal jurisdiction. The plaintiff’s petition against the 

Wineinger defendants alleged: 
31 

[E]ach agreed to personal jurisdiction and venue in any State 

or Federal Court located where the Lessor’s or Assignee’s 

principal corporate headquarters is located. The corporate 

headquarters of the Plaintiff is located in Clive, Polk County, 

Iowa. The Iowa District Court in Polk County is therefore the 

proper court in which to bring this action under the floating 

forum selection clause contained in the lease agreement. 

But unlike the other defendants, the Wineinger defendants signed a 

unique finance agreement with PSFS (NCMIC). The unique Wineinger 

finance agreement did not contain any clause related to choice of forum. 

In their answer and affirmative defenses, the Wineinger defendants 

made the same allegations regarding personal jurisdiction that were made 

by many of the defendants: “With respect to those allegations concern[ing] 

the personal jurisdiction of this court, Defendants affirmatively aver that 

the written contract speaks for itself, and denies that this court has 

personal jurisdiction over Defendants.” 

According to the Wineinger defendants, when documentation 

attached to a petition contradicts the underlying allegations, the contrary 

allegations are void. WINBCO Tank Co. v. Palmer & Cay of Minn., L.L.C., 

435 F. Supp. 2d 945, 955 (S.D. Iowa 2006). Therefore, the Wineinger 

defendants reason that PSFS 3 has failed to allege an adequate basis for 

jurisdiction and has failed to carry its burden of showing any basis for 

personal jurisdiction over the Wineinger defendants. Shams, 829 N.W.2d 

at 853. As a result, the Wineinger defendants seek reversal of the 

judgment entered against them on appeal. 

PSFS 3 claims that the Wineinger defendants failed to preserve their 

claim. According to PSFS 3, Wineinger did not raise the issue in district 

court and instead simply joined the motion attacking the assignment from 

NCMIC to PSFS 3 in the consolidated case. PSFS 3 claims that by failure 

of the Wineinger defendants to raise the issue, PSFS 3 was prevented from 

claiming that the Wineinger defendants’ financing with NCMIC, an Iowa 
32 

corporation, and their thirty-one payments to an Iowa company, is 

sufficient to establish jurisdiction in Iowa courts. See, e.g., State Cent. 

Bank v. Berzanskis, 149 F. Supp. 3d 1121, 1125–28 (S.D. Iowa 2015); 

Agricredit Acceptance Co. v. Goforth Tractor, Inc., No. 00–1694, 2002 WL 

1973195, at 3 (Iowa Ct. App. Aug. 28, 2002). 

Based on our review of the record, we conclude that the Wineinger 

defendants in their answer denied that “the court ha[d] personal 

jurisdiction over Defendants.” That is enough to raise the issue of personal 

jurisdiction. 

But other than to file an answer generally denying personal 

jurisdiction, Wineinger took no further affirmative steps to obtain a district 

court ruling on the question. When the district court received a proposed 

judgment from the plaintiffs, no resistance was filed asserting that there 

was an unresolved claim of lack of personal jurisdiction. 

 Under the circumstances, with hundreds of cases pending, there 

was simply no way for the district court to know there was an underlying 

unique personal jurisdictional issue in the Wineinger matter. When the 

district court asked for proposed judgments in the cases, including the 

case involving the Wineinger defendants, it was incumbent upon them to 

speak up. When they did not, we conclude they failed to preserve their 

personal jurisdiction claim. 

IV. Due Process Challenge to Damages. 

A. Introduction. By the time of trial of the bellwether cases, there 

were hundreds of enforcement actions pending in Polk County District 

Court. The district court was clearly and appropriately trying to manage 

the litigation in an expeditious fashion without truncating the ability of the 

parties to litigate their claims and defenses. A key aspect of the 

management of the cases was the stipulation in which the parties agreed 
33 

to a determination of common issues through the trial of two bellwether 

cases. Although the stipulation stated that common issues would be 

resolved in the bellwether cases, the stipulation did not identify the 

common issues. The question here is whether the district court’s method 

of calculating damages and the implementation of that method serially 

through the hundreds of pending cases deprived individual defendants of 

their day in court on damages. 

B. Standard of Review. We review constitutional issues, such as 

whether due process rights have been violated, de novo. State v. Clark, 

814 N.W.2d 551, 560 (Iowa 2012); In re Marriage of Seyler, 559 N.W.2d 7, 

8 (Iowa 1997). 

C. Positions of the Parties.

1. The defendants. The defendants declare that the district court’s 

method of calculating damages in the cases of individual defendants 

violated due process of law. First, they contend that the individual 

defendants were deprived of the opportunity to contest how much money 

they paid, and how much was owing, under their individual contracts. 

Second, the defendants contend that final judgments were entered against 

as many as seventy-three defendants who were not parties to any contract. 

The defendants claim that they were not allowed to press these individual 

claims by the district court’s action on damages in this case. 

2. The plaintiff. The plaintiff begins by asserting that while the 

Charlip defendants asserted a right to have an individual trial on damages, 

the Gossett defendants did not preserve error on the question related to 

“the district court’s alleged misnomer of several [defendants] in those 

judgments.” 

On the merits, PSFS 3 claims that contract damages for each 

defendant was not disputed. PSFS 3 begins its argument by canvassing 
34 

events surrounding the district court proceedings on May 17, 2018. On 

that date, PSFS 3 provided the district court and the parties with the 

simple mathematical formula for calculating damages in the bellwether 

cases—the number of monthly payments remaining multiplied by the 

monthly payment amount. Also on May 17, PSFS 3 filed a motion for 

enforcement of the stipulation and entry of judgment in the remaining 

cases. PSFS 3 notes that it attached to the motion a chart supported by a 

sworn declaration listing each defendant along with the applicable 

contractual monthly payment amount and the number of months 

outstanding. 

Although PSFS 3 recognizes that some defendants on May 30 and 

May 31 objected to enforcement of the stipulation as depriving them of 

their ability to contest damages, the defendants did not provide any 

evidence that the damages calculations were inaccurate. In response, 

PSFS 3 urged the court to treat its filing as a motion for summary 

judgment on the damages question. In support of its argument that the 

district court could consider the filings as a motion for summary judgment, 

PSFS 3 cites Stotts v. Eveleth, 688 N.W.2d 803, 811–12 (Iowa 2004) 

(treating a motion to dismiss as if it was a motion for summary judgment 

and in an effort to conserve judicial resources, declining to remand the 

case to district court). 

PSFS 3 further cites developments at the December 14 district court 

hearing on all pending motions. PSFS 3 notes that the defendants at the 

hearing made no argument that the PSFS 3 submission on damages was 

factually incorrect. PSFS 3 urged the district court to enter judgments 

against the remaining defendants. The defendants argued that the motion 

to enforce the stipulation was not styled as a “motion for summary 

judgment.” According to PSFS 3, the district court directed PSFS 3 to 
35 

submit proposed judgments for the remaining cases and offered 

defendants the opportunity to contest the number of remaining payments.

When PSFS 3 submitted proposed judgments, the defendants did not 

respond. 

Under the circumstances, PSFS 3 asserts that the defendants’ due 

process claims are without merit. According to PSFS 3, the defendants 

were entitled under due process to notice and an opportunity to be heard 

on the question of damages, and the defendants certainly had both. 

Johnson v. Mitchell, 489 N.W.2d 411, 414–15 (Iowa Ct. App. 1992). 

D. Discussion. The defendants claim that they had a right to 

dispute the number and amount of payments owed by them to PSFS 3. 

We do not doubt the general proposition that the defendants were entitled 

by due process to a hearing on the issue of individual damages if they 

chose to put the question at issue in this litigation. The question is 

whether the defendants were in fact provided with the opportunity for their 

individualized damages claims. 

The parties, of course, stipulated to a resolution of the common 

issues in the bellwether cases. We think the manner in which damages 

are calculated was a common issue that was decided in the bellwether 

cases. But the amount of damages, namely, how many payments were 

missed and in what amount, is not a common issue across the cases. After 

the resolution of the bellwether cases, each individual defendant was 

entitled to a hearing on the question of damages. 

After the bellwether cases were decided, the district court invited the 

plaintiffs to submit individualized judgments in each case where the 

damages would be calculated under the methodology accepted in the 

bellwether cases. The inputs for the calculation came from one party, 
36 

PSFS 3. Again, the defendants were clearly entitled to contest these 

claimed amounts. 

The district court seems to have recognized the need to provide the 

defendants with their day in court on the issue. At the hearing inviting 

PSFS 3 to submit proposed judgments, the district court expressly stated 

that once the proposed judgments were submitted, the district court would 

“give the defendants an opportunity to respond.” Here, once the 

judgments were submitted, the district court seems to have put the burden 

of affirmatively filing a resistance on the defendants. When no resistances 

were filed, the district court, without a hearing, began entering a series of 

judgments against the individual defendants. 

This procedure was a reasonable effort by the district court to 

manage a massive piece of consolidated litigation. When the proposed 

judgments were submitted, the defendants knew they had an opportunity 

to respond but chose not to file any resistance to the specific calculations 

in any individual case. The district court regarded the occasion as “put 

up or shut up” time on the question of factual challenges to individual 

damages. After nearly thirty days had passed without any resistances, the 

district court began entering judgments in the individual pending cases. 

Under the circumstances, it cannot be said that the defendants were 

deprived of notice and an opportunity to be heard on the issue of individual 

damages. When the proposed judgments were submitted, they had an 

opportunity to object to the calculations or to offer any other objections to 

entry of judgment. The fact that they chose not to avail themselves of the 

opportunity they were provided does not create a problem of fundamental 

fairness in the litigation which was already eight years old at the time the 

district court fashioned its approach to the remaining cases. 
37 

V. Validity of Finance Agreements Under Iowa Code Chapter 

535. 

A. Introduction. The legal obligations that arise from finance 

agreements have been the subject of a number of important recent 

opinions of this court. See generally GreatAm. Fin. Servs. Corp. v. Natalya 

Rodionova Med. Care, P.C., 956 N.W.2d 148 (Iowa 2021); C & J Vantage 

Leasing Co. v. Wolfe, 795 N.W.2d 65 (Iowa 2011); C & J Vantage Leasing 

Co. v. Outlook Farm Golf Club, L.L.C., 784 N.W.2d 753 (Iowa 2010). In 

these types of three-party transactions, a vendor ordinarily solicits sales 

of certain equipment from a potential purchaser. Once a purchaser 

expresses interest, the purchaser completes a finance agreement with a 

third party obligating the purchaser to make a series of monthly payments 

for a period of time. The third-party financer then purchases the 

equipment from the vendor, executes a finance agreement with the 

purchaser, and looks to the purchaser to fulfill the obligation to make the 

payments required under the finance agreement. The finance agreement 

often has a hell-or-high-water provision that obligates the purchaser to 

make the payments required under the finance agreement absolutely and 

unconditionally. Although often characterized in the documents as a 

“finance lease,” the labels in the documents are not determinative and the 

transactions may be treated as a sale with a security interest 

notwithstanding language to the contrary in the documentation. Wolfe, 

795 N.W.2d 65, 73–75. 

As in this case, disputes may arise when the purchaser claims that 

the vendor made false representations or promises regarding the purchase 

and seeks to stop making payments to the finance company. The finance 

company may defend by asserting that the payments under the finance 
38 

agreement are unconditional in light of the hell-or-high-water clause in 

the financing agreement. 

In this case, in order to avoid an obligation to continue making 

payments to the finance company, the purchaser seeks to invalidate the 

finance agreement by claiming two of its provisions violate Iowa Code 

chapter 535 related to money and credit. They claim that by failing to 

disclose an interest rate, the plaintiff violated Iowa Code section 535.17(1) 

which requires that the material terms of credit transactions be disclosed. 

Second, the defendants assert that the actual rate of interest charged in 

the transaction was usurious under Iowa Code section 535.2(1). 

B. Standard of Review. We review issues of statutory construction 

for errors at law. Wolfe, 795 N.W.2d at 73. 

C. Positions of the Parties. 

1. The defendants. The defendants assert that the finance 

agreements involved in this matter are “credit agreements” under Iowa 

Code chapter 535. They note that under Iowa Code section 535.17(5)(c), 

a “ ‘[c]redit agreement’ means any contract made or acquired by a lender 

to loan money, finance any transaction, or otherwise extend credit for any 

purpose, and includes all of the terms of the contract.” The defendants 

assert that the finance agreements in this case, regardless of their label as 

leases, fall within the scope of the definition of a credit agreement under 

the statute. 

Under Iowa Code section 535.17(1), a credit agreement must provide 

“all of the material terms of the agreement.” The statute does not define 

material. But the defendants argue that the material terms of the finance 

agreements in this case include the amount loaned and the interest rate 

on the loan. Fairfield Six/Hidden Valley P’ship v. Resol. Tr. Corp., 860 F. 
39 

Supp. 1085, 1089 (D. Md. 1994); T.O. Stanley Boot Co. v. Bank of El Paso, 

847 S.W.2d 218, 221 (Tex. 1992). 

The defendants cite the Wineinger contract as an example of an 

equipment financing agreement that satisfies the requirements of Iowa 

Code section 535.17(1). The Wineinger agreement discloses the total 

amount financed, the monthly payment, and the number of months over 

which the payments are to be made. From this information, the parties 

can calculate the rate of interest on the loan. 

But in the other finance agreements in this case, it is not possible 

to calculate the interest rate on the loaned amount. To buttress their 

argument that the interest rate is a material term, the defendants point to 

Iowa’s usury statute, which permits the parties obtaining credit for 

business purposes to agree in writing to pay a rate of interest higher than 

the statutorily established rate. Iowa Code § 535.2. 

The defendants also point to the terms of the finance agreement as 

establishing that there is, in fact, an interest rate on the loaned amounts, 

even though it is not disclosed. Paragraph 1 of the finance agreement 

states that: 

If it is determined that your total payments result in an 

interest rate higher than allowed by applicable law, then any 

excess interest collected will be applied to the repayment of 

principle [sic] and interest will be charged at the highest rate 

allowed by law. 

Further, the defendants point out that prior to the assignment of the 

finance agreements to PSFS 3, NCMIC prepared amortization schedules 

for each transaction that contained principal and interest calculations. 

2. The plaintiff. At the outset, the plaintiff claims that the 

defendants failed to preserve error on the issue of whether the finance 

agreements violate the credit agreement disclosure provision of Iowa Code 
40 

section 535.17 or the usury provision of Iowa Code section 535.2. The 

plaintiff claims that these issues should have been litigated in the Florida 

district court litigation, where the federal court considered the common 

issues of enforceability among the mass participants in the litigation. As 

a result, the plaintiffs claim the defendants are precluded from raising the 

issue in the Iowa actions. See Van Haaften, 815 N.W.2d at 22–23. 

On the merits, the plaintiff does not contest the applicability of Iowa 

Code chapter 535 to the finance agreements. Instead, the plaintiff points 

out that each finance agreement contains the equipment being financed, 

the number of payments to be made (60), the frequency of each payment 

(monthly), and the amount of each payment (which was typically $508).8 

These disclosures, according to the plaintiff, are sufficient to satisfy the 

requirements of Iowa Code section 535.17(1). 

The plaintiff cites C & J Vantage Leasing Co. v. Wolfe, 795 N.W.2d 

65, in support of their argument. In Wolfe, the finance agreement 

contained the same key terms as the finance agreement in this case. Id.

at 71–72. On the question of lack of disclosure of interest rate, the Wolfe

court observed: 

Although the agreement did not expressly list an interest rate, 

it did provide Lake MacBride was to make sixty monthly 

payments of $299 to C & J. Section 535.17(1) contains no 

requirement that the interest rate must be listed separate 

from the total payment required under the agreement. 

Id. at 82. The Wolfe case further compared Iowa Code section 535.17(1) 

with federal law which expressly requires the disclosure of interest rates 

 

8The agreements are labeled “Equipment Lease Application and Agreement.” 

Regardless of their label, they operate as finance agreements supporting the purchase of 

the equipment in this case. We therefore characterize the documents as finance 

agreements rather than leases. 
41 

in consumer leases and consumer credit transactions. Id. at 82 (citing 5 

U.S.C. § 1632). 

The plaintiff further argues that there is no requirement that the 

finance agreement disclose the purchase price paid by a finance company 

to the vendor of commercial equipment as a material term under Iowa 

Code section 535.17(1). According to the plaintiff, the price paid by the 

finance company to the vendor was not disclosed in Wolfe. While there is 

reference to the term “price” in Wolfe, in context, the term is in reference 

to the total amount to be paid under the finance agreement. See generally 

Wolfe, 792 N.W.2d 65. 

Next, on the question of the usury statute in Iowa Code section 

535.2, the plaintiff argues that the statute simply does not apply. The 

plaintiff again cites Wolfe, which noted that a beverage cart was used in 

connection with a business purpose and that, as a result, a business could 

agree to pay any rate of interest and thus could not invoke the usury 

statute. Wolfe, 795 N.W.2d at 82. 

In the alternative, the plaintiff claims that even if the finance 

agreements were required to disclose a higher rate of interest, the finance 

agreements would remain enforceable. According to the plaintiff, Iowa law 

provides that if the interest rate in a business transaction is usurious or 

if a creditor fails to provide in a written agreement for any rate of interest, 

the remedy is interest awarded at the lower statutory interest rate of 5%. 

Power Equip., Inc. v. Tschiggfrie, 460 N.W.2d 861, 863 (Iowa 1990). 

D. Discussion. We think there is a serious question of whether the 

defendants can raise the disclosure and usury issues in light of the Florida 

declaratory judgment action in which the parties litigated common issues 

related to enforcement of the finance agreements. Ordinarily, a litigant 

does not get two bites of the apple in different fora. 
42 

In any event, on the chapter 535 issues, we find that the Wolfe case 

is controlling. The issues in Wolfe were identical to those posed in this 

case. The finance agreement simply disclosed that the purchaser was 

required to make “sixty monthly payments of $299.” Wolfe, 795 N.W.2d 

at 82. We declined to impose a requirement that interest rate also be 

disclosed. Id. We held that the terms contained in the agreement were 

sufficient to satisfy the requirements of section 535.17(1). Id. Although 

there is no direct mention in Wolfe of a claim that the purchase price paid 

by the finance company to the vendor was required to be disclosed, the 

logic of the decision clearly compels a negative answer. The number of 

payments over time and the amount of each payment is sufficient 

disclosure of material terms under the statute. 

Wolfe also disposes of the usury argument. In Wolfe, we noted that, 

as here, the transaction was for a business purpose. Id. Under the 

statute, a person borrowing money for a business purpose is permitted in 

writing to agree to any rate of interest in a credit transaction. Iowa Code 

section 535.2(2)(a)(5). In Wolfe, we concluded that because the business 

purchaser could agree in writing to any rate of interest, there was no 

violation of the usury statute. 795 N.W.2d at 82. Therefore, whatever the 

interest rate might have been or however the interest rate would have been 

calculated would not be usurious. See id. The reasoning applies in this 

case with full force. 

VI. Failure to Prove Damages Arising from Breach of Contract.

A. Introduction. The defendants challenge whether the plaintiff 

proved the fact of damages in these cases. The district court accepted the 

basic methodology of the plaintiff in calculating base damages, namely, by 

multiplying the number of missed payments by the amount of each 
43 

payment. The defendants claim that this approach to damages was 

improper. 

B. Standard of Review. The standard of review on the question of 

whether damages were proven in this case is for correction of errors at law. 

Flom v. Stahly, 569 N.W.2d 135, 139 (Iowa 1997). 

C. Positions of the Parties. 

1. The defendants. The defendants argue that PSFS 3 failed to 

prove damages arising from the alleged breach of contract. With respect 

to damages, the defendants emphasize that damages are limited to those 

that are “foreseeable or reasonably contemplated by the parties” when they 

entered into the agreement. (Citing Kuehl v. Freeman Brothers Agency, 

Inc., 521 N.W.2d 714, 718 (Iowa 1994).) They note that damages must be 

proven with “reasonable certainty.” Dopheide v. Schoeppner, 163 N.W.2d 

360, 367 (Iowa 1968). 

The defendants proceed to project these general principles against 

the record developed in the bellwether cases. The defendants assert that 

PSFS 3 witnesses could not explain, for instance, when exactly monthly 

payments were due under the contract. The defendants note that the 

software program used to compute damages was a program designed to 

manage leases and not equipment finance agreements. Further, the 

defendants observe that while NCMIC had software that could calculate 

amortization schedules for each contract, no such calculations were 

produced. Thus, the defendants argue that while the payments consisted 

of both principal and interest, PSFS 3 failed to provide a calculation 

allocating the payments. According to the defendants, the mere proof of 

missing contractual payments does not amount to a prima facie case of 

damages. 
44 

The defendants assert that the damages awarded by the district 

court—a simple calculation of unpaid monthly payments multiplied by the 

amount of each payment—was inconsistent with the default clause in the 

finance agreement. The default provision states: “If You default, We may 

require that You pay 1) all past due amounts under this Lease, and 2) all 

future amounts owed for the unexpired term, discounted at the rate 6% 

per annum.” 

The defendants claim that future amounts “owed for the unexpired 

term” can only refer to future principal amounts. Because the future 

principal amounts due under each finance agreement have not been 

calculated, the defendants claim damages in these cases cannot be 

calculated. 

2. The plaintiff. The plaintiff responds that the basic starting point 

for the calculation of damages in this case is a simple calculation of the 

amount of the monthly payment multiplied by the number of missed 

payments. The plaintiff asserts that a commonplace measure of damages 

is to put the plaintiff in the place he or she would have occupied had the 

contract been performed. Aurora Bus. Park Assocs., L.P. v. Michael Albert, 

Inc., 548 N.W.2d 153, 157 (Iowa 1996) (en banc). Further, the parties 

expressly contracted for the acceleration of balances and the remedy of 

payment of all amounts that the plaintiff would have received under the 

contract. Parties are generally free to provide for their own remedies for 

breach of contract. Wolfe, 795 N.W.2d at 77. 

D. Discussion. On this issue, we agree with the plaintiff. The 

contract itself called for a number of payments over a period of years in a 

specific amount. Providing the plaintiff with the payment it was entitled 

to if the contract had been honored is an appropriate approach to damages 

in this case. See Aurora Bus. Park Assocs., L.P., 548 N.W.2d at 157. 
45 

Further, the parties expressly agreed to this remedial provision in the 

contract. The argument of the defendants that the plaintiff failed to prove 

damages is without merit. 

VII. Unconscionability of Default Interest Rate. 

A. Introduction. Under Paragraph 9 of the finance agreements, 

the defendants agreed to pay interest on all past due amounts at the rate 

of 1.5% per month or the highest amount permitted by law. The 

defendants attack this provision as unconscionable under Iowa Code 

section 554.13108(1). 

B. Standard of Review. Unconscionability is a question of law and 

is subject to review for correction of errors at law. See Iowa Code 

§ 554.2302(1); Casey v. Lupkes, 286 N.W.2d 204, 207 (Iowa 1979).

C. Positions of the Parties. 

1. The defendants. The defendants assert that the damages 

calculation imposed by the district court included approximately an 8.99% 

per annum undisclosed nondefault interest rate arising from the finance 

agreement and an additional 18% per annum penalty for late payment. 

According to the defendants, the total default interest rate was thus 

26.99% per annum not including any late fees. 

The defendants assert that under Iowa law, the propriety of 

awarding default interest is subject to review by the court. Carson Grain 

& Implement, Inc. v. Dirks, 460 N.W.2d 483, 486 (Iowa Ct. App. 1990). 

According to the defendants, the default interest rate must amount to an 

appropriate liquidated damages provision and not a penalty. By 

accelerating the monthly payments after default which included the 

undisclosed 8.99% interest rate, and then adding an additional 18% 

interest rate, the defendants have obtained an unlawful double recovery. 
46 

In the alternative, the defendants claim that default interest may be 

recovered only after accelerating the debt. The defendants claim PSFS 3 

accelerated the principal amounts only by filing suit and that, as a result, 

any interest penalty should arise only as of the month following the filing 

of the action. But because the interest rate was not disclosed in the 

finance agreements, and no amortization schedule was provided, it is not 

possible to know the real amount of total interest if the 18% default penalty 

is imposed. Because the damages calculation is speculative, the 

defendants ask that the default interest portion of the final judgments be 

stricken as an unenforceable penalty under Iowa law. 

2. The plaintiff. The plaintiff responds by arguing that there is 

nothing unlawful about an acceleration clause. On the issue of triggering 

acceleration, the plaintiff states there is no requirement that the creditor 

take action to accelerate the amount due. Aurora Bus. Park Assocs., L.P., 

548 N.W.2d at 154. Once the actions were filed, according to the plaintiff, 

the future payments were accelerated. 

The plaintiff points out that the parties agreed to an 18% default 

interest. The plaintiff notes that the defendants have been in default for 

ten years and that the plaintiff has been burdened by the need to track 

the defaulted accounts as impaired assets, monitor their status, and 

monitor the defendants’ ability to pay. The plaintiff further notes that Iowa 

courts have long upheld an increased rate of interest upon default. See 

Fed. Land Bank of Omaha v. Wilmarth, 218 Iowa 339, 343, 252 N.W. 507, 

510 (1934); see also In re Johnston, No. 03–03495S, 2004 WL 3019472, at 

*2, *7 (Bankr. N.D. Iowa Dec. 20, 2004). The plaintiffs claim that default 

interest rates of 18% or higher are standard in the equipment finance 

industry. See Sec. State Bank v. Soults Farms, Inc., No. 03–0494, 2004 WL 

792673, at *4 (Iowa Ct. App. Apr. 14, 2004). The plaintiff claims that in 
47 

Wolfe, the court held a substantially similar agreement was not 

unconscionable. 795 N.W.2d at 80–81. 

D. Discussion. On this issue, we look first to the contractual 

terms. The parties agreed that in the event of a default, there would be an 

acceleration of all the amounts due, discounted by 6% per year on future 

payments. Upon that amount, the parties agreed that a default interest 

rate of 18% per year would apply. Certainly, in a business contract, a 

presumption arises that the agreement of the parties on financial terms is 

enforceable. 

A party must climb a tall hill to establish that a term of a business 

agreement is unconscionable. In order to be unconscionable, a provision 

must be such that no person in his or her right senses “would make [it] on 

the one hand, and . . . no honest and fair [person] would accept [it] on the 

other.” Smith v. Harrison, 325 N.W.2d 92, 94 (Iowa 1982) (quoting Casey, 

286 N.W.2d at 207). As noted in Wolfe, factors to be considered include 

“assent, unfair surprise, notice, disparity of bargaining power, and 

substantive unfairness.” 795 N.W.2d at 80 (quoting C & J Fertilizer, Inc. 

v. Allied Mut. Ins., 227 N.W.2d 169, 181 (Iowa 1975)) (en banc). The 

doctrine of unconscionability is an extreme one. It is not available to 

rescue a party from a bad bargain. Wolfe, 795 N.W.2d at 80; Smith, 325 

N.W.2d at 94. 

We find nothing in the record, either procedurally or substantively, 

to support a claim that the default interest rate meets the demanding 

standards of unconscionability. We note that a number of other courts 

have upheld 18% interest rates in a variety of contexts. See Cheshire

Mortg. Serv., Inc. v. Montes, 612 A.2d 1130, 1135–38 (Conn. 1992) 

(determining an 18% interest in real estate contract was not 

unconscionable); In re White River Conservancy Dist. v. Commonwealth of 
48 

Eng’gs, Inc., 575 N.E.2d 1011, 1017 (Ind. Ct. App. 1991) (determining 18% 

interest rate not unconscionable). We also note that while the finance 

agreement also provides for a late fee on unpaid balances, the plaintiff did 

not seek to enforce that provision in this proceeding. 

The defendants claim that the plaintiff is collecting “double interest” 

because the payments made to them are, in fact, a combination of interest 

and principal. We do not find that this theory makes the 18% default 

interest rate unconscionable. Defendants cite Carson Grain & Implement, 

Inc. v. Dirks, 460 N.W.2d 483. But Carson Grain is plainly distinguishable. 

In Carson Grain, the court determined that it would not apply both the 

default rate of 18% interest and the statutory rate of judgments. Id. at 

486. We do not face this kind of double interest situation here. 

VIII. Award of Attorney Fees. 

The defendants suggest that the district court erred in determining 

PSFS 3 was entitled to an award of attorney fees. According to the 

defendants, there was no proof at trial that PSFS 3 paid any attorney fees 

and that PSFS 3 has no obligation to indemnify NCMIC for attorney fees 

that it may have incurred in connection with the litigation. 

While the district court did enter an attorney fees order in the two 

bellwether cases, those matters have been resolved and their appeals 

dismissed. With respect to the other cases, the district court has not 

entered a court order on that issue. Once the district court rules, the 

question of attorney fees is separately appealable. Iowa R. App. P. 6.103(2) 

(“A final order or judgment on an application for attorney fees entered after 

the final order or judgment in the underlying action is separately 

appealable.”). 
49 

IX. Conclusion. 

For the above reasons, we affirm the district court’s rulings and 

judgments. 

AFFIRMED.