Opinion ID: 2033261
Heading Depth: 1
Heading Rank: 4

Heading: Chapter 553Iowa's Competition Law.

Text: HMR claims that the defendants engaged in a combination or conspiracy to restrain or monopolize the recycling activities in HMR's market in violation of chapter 553. That chapter states that [a] person shall not attempt to establish[,] or establish, maintain, or use a monopoly of trade or commerce in a relevant market for the purpose of excluding competition.... Id. § 553.5. There are, however, exceptions to this prohibition. Section 553.6 states: This chapter shall not be construed to prohibit: ... 4. The activities or arrangements expressly approved or regulated by any regulatory body or officer acting under authority of this state or of the United States. 5. The activities of a city ... when acting within its statutory or constitutional home rule powers and to the same extent that the activities would not be prohibited if undertaken by the state. Id. § 553.6(4)-(5). HMR claims there is no evidence in the record that certain allegedly anticompetitive activities of the defendants had been expressly approved or regulated as required by subsection (4). It claims this deficiency is fatal to any exemption under section 553.6, including the exemption contained in subsection (5). We do not agree that subsection (4)'s requirement of express approval or regulation applies to subsection (5). It is clear that each subsection describes an independent exemption from the constraints of chapter 553. Subsection (5) does not require express approval or regulation of the challenged activities and, therefore, we reject HMR's contention that the purported lack of such approval or regulation renders the subsection (5) exemption inapplicable. Turning to an examination of the applicability of subsection (5), we agree with the district court that this provision exempts the defendants' activities from the scope of chapter 553. Subsection (5) applies to the activities of a city when the city is acting within its statutory or home rule constitutional powers, but only to the same extent that the activities would not be prohibited if undertaken by the state. Id. § 553.6(5). The Iowa Constitution provides: Municipal corporations are granted home rule power and authority, not inconsistent with the laws of the general assembly, to determine their local affairs and government, except that they shall not have power to levy any tax unless expressly authorized by the general assembly. Iowa Const. art. III, § 38A. Iowa Code section 364.1 similarly provides: A city may, except as expressly limited by the Constitution, and if not inconsistent with the laws of the general assembly, exercise any power and perform any function it deems appropriate to protect and preserve the rights, privileges, and property of the city or of its residents, and to preserve and improve the peace, safety, health, welfare, comfort, and convenience of its residents. Iowa Code § 364.1. In interpreting cities' home rule power, this court has noted that cities now have the authority to act unless a particular power has been denied them by statute. City of Des Moines v. Master Builders of Iowa, 498 N.W.2d 702, 703-04 (Iowa 1993). We have already determined that the defendants' operation of recycling programs is a legitimate city enterprise. These programs clearly advance the health, welfare, comfort, and convenience of [the cities'] residents. Iowa Code § 364.1. Accordingly, the recycling programs fall within the cities' home rule powers, absent a legislative enactment denying cities this authority. HMR has not directed us to any statutory provision that would deny the defendants the power to operate a recycling program. To the contrary, as discussed above, cities are mandated to incorporate recycling into their solid waste management plans. We hold, therefore, that the defendants' operation of recycling programs is within their home rule power. We next consider whether such programs would be prohibited if undertaken by the State. Again, HMR has not identified any statute or principle of law that would prohibit the State from undertaking a recycling program. We hold, therefore, that the cities' recycling services fall within the exemption contained in section 553.6(5), rendering the prohibitions contained in chapter 553 inapplicable. See Water Dev. Co. v. Board of Water Works, 488 N.W.2d 158, 162-63 (Iowa 1992) (holding that section 553.6(5) exempted the city's water works from the application of chapter 553).