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Iowa Northern Railway deal warrants heightened scrutiny

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Iowa Northern Railway deal warrants heightened scrutiny


Quaker Oats plant in Cedar Rapids, photographed by David Harmantas (Shutterstock).

Scott Syroka is a former Johnston city council member.

Attorneys for Canadian Pacific Kansas City submitted a 59-page filing to the U.S. Surface Transportation Board on February 26 regarding the proposed acquisition of Iowa Northern Railway by Canadian National.

The Canadian Pacific Kansas City filing highlights the proposed deal’s “national importance” and cites “competitive concerns of significant magnitude” in calling for the Surface Transportation Board to classify Canadian National’s takeover attempt of Iowa Northern as a “Significant” transaction rather than the “Minor” transaction status that Canadian National has sought.

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The distinction matters because “Minor” transactions aren’t subject to the same regulatory requirements as “Significant” transactions—meaning the public would have less access to information and less time to review the deal.

Canadian Pacific Kansas City made clear in its filing that it remains neutral for now on whether the Surface Transportation Board should approve or reject the acquisition. But it is calling for the “Significant” transaction classification “so that the Board and interested members of the public can undertake a more deliberate and thorough exploration of the competitive and other issues the Transaction raises.”

I wrote about some of those potential issues back in December. This week’s filing goes further in building a case in favor of classifying the transaction as “Significant.”

NATIONAL IMPORTANCE

The filing highlights the national significance of Iowa Northern’s service area, explaining that “The area served by Iowa Northern is of critical importance to U.S. agriculture. Cedar Rapids ranks as ‘[t]he largest corn-processing city in the world,’ hosting manufacturing plants for many familiar names, including General Mills, Quaker Oats, Cargill and Archer Daniels Midland. The Quaker Oats plant at Cedar Rapids is the largest cereal mill in the world.”

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Beyond that, it underscores the importance of “efficient and competitive rail transportation” in shippers’ ability to transport “commodities like corn, soybeans and oats to processing facilities,” as well as transport “processed commodities like [dried distillers grains] DDGs, soybean oil, ethanol, and biofuels to market.”

ANTICOMPETITIVE CONCERNS

The filing notes that Canadian National and Iowa Northern are currently head-to-head competitors. For that reason, their merger would result in a “clear loss of competition” for local and international shippers alike, such as in the case of Canadian oats that are transported to Quaker Oats’ Cedar Rapids mill.

That loss of competition “would allow CN to drive up IANR’s rates (or reduce its services levels), knowing that doing so would risk nothing.” The filing continues, “All viable routes to Cedar Rapids from Canada would be controlled by CN in the future, whereas today IANR is fully independent of CN.”

The filing states, “The competitive ‘status quo’ will not be maintained. Shipper competitive options will be reduced everywhere that both CN and Iowa Northern have access, and more broadly Iowa Northern will be removed as an independent competitive force across the entire east-central Iowa region that it and CN both serve.”

DUBIOUS BENEFITS

In response to Canadian National’s claims that its proposed acquisition would yield win-win-win benefits for all stakeholders, the Canadian Pacific Kansas City filing states, “There is in fact substantial reason to be skeptical of the magnitude of the benefits CN identifies…”

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For example, the filing calls into question the accuracy of the modeling Canadian National used to claim the deal would result in nearly 15,000 trucks being removed from highways.

Canadian Pacific Kansas City also argues that Iowa Northern is already meeting its shippers’ needs and does not need Canadian National to continue to do so. “In CPKC’s experience, Iowa Northern already provides quality service (and provides extra services) on an economical basis,” the filing reads. “It is not clear how CN could provide the same shipper amenities at lower cost to create rail-to-rail diversions.”

CANADIAN NATIONAL’S PR AND LOBBYING EFFORTS

There are signs that Canadian National may be getting nervous over the increased scrutiny. Recently, the company’s Public and Government Affairs team has invested significant resources in public relations and lobbying efforts regarding the deal. Canadian National has gone so far as to produce a podcast episode about the deal, lobbied local and state elected officials, launched a microsite touting the purported benefits of acquiring Iowa Northern, and bought an unknown amount of digital ads on sites like Google to promote the deal.

The microsite and digital ads avoid words like “merger,” which can often contain negative associations with reductions in quality and service, inflated pricing, and monopolization. Instead, they use more neutral words to describe the transaction, such as “combination.”

It all adds up to a significant effort to push through a transaction that Canadian National wants the Surface Transportation Board to classify as “Minor.”

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COMPANY’S LOBBYING YIELDS SOME SUCCESS

To date, the following individuals or entities have sent letters to the Surface Transportation Board in support of Canadian National’s acquisition of Iowa Northern:

  • Iowa State Senators Waylon Brown and Tim Kraayenbrink
  • Cedar Rapids Mayor Tiffany O’Donnell
  • Waterloo Mayor Quentin Hart
  • Cedar Falls Mayor Danny Laudick
  • Butler County Supervisors Greg Barnett, Wayne Dralle, and Rusty Eddy
  • Cedar Rapids Metro Economic Alliance
  • Iowa Area Development Group
  • Iowa Association of Business and Industry
  • Sukup Manufacturing Co.
  • Hawkeye Community College, Kirkwood Community College, North Iowa Area Community College
  • the SMART-TD union

These letters can be viewed within the application Canadian National filed with the Surface Transportation Board on January 30, 2024.

Alternatively, you can access Canadian National’s application and other documents related to the proposed deal by visiting the Surface Transportation Board’s website. Start here > confirm “Search For” field is set to “Dockets” > enter Docket Number “FD” and “36744” > this will display the various docket results > click on the “FD_36744” hyperlink under Docket Number > you will now be able to see a list of the filings and decisions submitted in regards to this deal, accessible as hyperlinked PDFs in the Attachment column.

FULL STEAM AHEAD FOR CANADIAN NATIONAL INVESTORS

As Canadian National chugs forward with its attempt to acquire Iowa Northern, it’s full steam ahead in terms of rewarding Wall Street investors. In its year-end earnings results released in January, the company announced a 7 percent dividend increase to shareholders as well as plans to buy back nearly USD $3 billion in stock per the latest currency conversion rate.

Canadian National did not mention any plans to pay back recent taxpayer dollars intended for short line railroads that were invested in Iowa Northern if the acquisition attempt is successful. Since 2021 alone, the U.S. Department of Transportation has awarded at least $13.9 million to Iowa Northern, including an education and training grant to improve safety on short lines across the country and a grant to fund rail improvements specifically in rural areas.

Canadian National also disclosed for the first time it had spent USD $230 million (including transaction costs) on its Iowa Northern acquisition attempt to date.

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Iowa

Lawsuit claiming pathology 'monopoly' is dismissed by court • Iowa Capital Dispatch

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Lawsuit claiming pathology 'monopoly' is dismissed by court • Iowa Capital Dispatch


A federal judge has dismissed a lawsuit alleging a group of central Iowa pathologists conspired to maintain a monopoly at the expense of patients.

The lawsuit was one of three involving allegations of unfair competition, harassment, retaliation and discrimination among central Iowa pathologists.

The suit was filed in May 2024 in U.S. District Court for the Southern District of Iowa by four pathologists who last year established Goldfinch Laboratory of Urbandale – physicians Tiffani Milless, Caitlin Halverson, Renee Ellerbroek and Jared Abbott.

The four sued their previous employers, Iowa Pathology Associates of Des Moines and Regional Laboratory Consultants, alleging the two companies tried to suppress competition for pathology services in central Iowa and maintain a monopoly, all in violation of state and federal law.

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Each of the companies provides dermatopathology and other pathology services for patients in central Iowa whose physicians require laboratory services that provide medical diagnoses from biological specimens.

The lawsuit alleged that since 2021, IPA and RLC pressured its pathologists to sign employment agreements that include a no-compete clause. At the time, the four IPA-employed pathologists who would later depart and form Goldfinch refused to sign the agreement.

The lawsuit claims the agreement was not intended to prohibit the use of confidential corporate information and was instead aimed at maintaining IPA’s and RLC’s monopoly on services.

As part of its lawsuit, Goldfinch accused IPA of refusing to share biopsy slides with Goldfinch pathologists, even when those slides were required to ensure the continuity of care offered to patients and even when, according to Goldfinch, the refusal “could well have caused harm to patients.”

IPA and RLC denied any wrongdoing and filed a motion to have the case dismissed. U.S. District Judge Rebecca Goodgame Ebinger recently granted the motion after finding that Goldfinch failed to define a geographic market in which consumers had no other source for pathology services.

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“Even assuming central Iowa is where the defendants draw a sufficiently large portion of their business, Goldfinch has not sufficiently alleged a plausible reason why potential referral sources cannot practicably turn to alternative sources outside central Iowa,” the judge ruled. “Goldfinch has not plausibly identified a relevant market as required to allege attempted monopolization.”

Two other lawsuits still pending

The federal lawsuit followed a still-pending state court lawsuit filed by IPA and RLC against the four Goldfinch partners in late 2022 that is in the final stages of litigation.

That lawsuit seeks to block Goldfinch from soliciting IPA clients or using IPA information, and alleges the Goldfinch pathologists were “flagrantly, rampantly and disloyally working against” IPA’s interests even before they left IPA.

A bench trial in that case was held last month, but the court has yet to issue a decision and recent post-trial briefs are sealed from public view.

Separately, two of the Goldfinch pathologists — Tiffani Milless and Caitlin Halverson – have filed a discrimination lawsuit against IPA and RLC, alleging they were paid $200,000 to $350,000 annually, which they claim was far less than what some of the less qualified male doctors were paid.

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A trial in that case is scheduled for August 2025.



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Iowa women’s basketball to retire Caitlin Clark’s No. 22 jersey vs. JuJu Watkins and USC

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Iowa women’s basketball to retire Caitlin Clark’s No. 22 jersey vs. JuJu Watkins and USC


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IOWA CITY — Anyone who has visited Carver-Hawkeye Arena this season has seen the banner rolled up in the rafters, waiting to be unveiled at the perfect time. No one can see what’s on it. But everyone attached to Iowa women’s basketball knows what’s on it.

It comes down Feb. 2.

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Caitlin Clark’s No. 22 will be retired on, by no coincidence, 2-2-25, the university announced Wednesday. The ceremony will coincide with arguably the Hawkeyes’ biggest home game of the season, as JuJu Watkins and USC will be in the building to watch Clark’s legacy further cemented in Iowa women’s basketball lore.

“I’m forever proud to be a Hawkeye and Iowa holds a special place in my heart that is bigger than just basketball,” Clark said in a school release. “It means the world to me to receive this honor and to celebrate it with my family, friends and alumni. It will be a great feeling to look up in the rafters and see my jersey alongside those that I’ve admired for so long.”

It was announced in April at the team’s end-of-year celebration that Clark’s jersey would be retired in the near future, a fitting announcement as Iowa honored another team reaching the national title game. After proudly proclaiming she’d take Iowa to its first Final Four in three decades, Clark did that twice and then some with a bevy of unforgettable heroics and accolades.

Atop the list is her unmatched scoring prowess. In a 17-day span from Feb. 15 to March 3, Clark broke Kelsey Plum’s all-time women’s NCAA Division I scoring record, passed AIAW legend Lynette Woodard for the major college scoring record, then passed LSU’s Pete Maravich for most career points in Division I history.

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Clark is a two-time recipient of the Wooden, Naismith, Wade, Ann Meyers Drysdale, Honda Cup and AAU Sullivan awards. The two-time consensus national player of the year led Iowa to back-to-back national championship games (2023-24) and three Big Ten Tournament titles (2022-24). Clark also won the Nancy Lieberman Point Guard Award and Dawn Staley Award three times each.

Clark is the only player in NCAA Division I men’s or women’s basketball history to lead her conference in scoring and assists four consecutive seasons. In her senior year, Clark led the nation in 10 different offensive categories, and broke the women’s NCAA Tournament scoring record. She’s since been drafted No. 1 overall to the Indiana Fever, won WNBA rookie of the year and was named TIME Magazines athlete of the year.

“Caitlin Clark has not only redefined excellence on the court but has also inspired countless young athletes to pursue their dreams with passion and determination,” Iowa AD Beth Goetz said in a statement. “Her remarkable achievements have left an indelible mark on the University of Iowa and the world of women’s basketball.

“Retiring her number is a testament to her extraordinary contributions and a celebration of her legacy that will continue to inspire future generations. Hawkeye fans are eager to say thank you for so many incredible moments.”

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Dargan Southard is a sports trending reporter and covers Iowa athletics for the Des Moines Register and HawkCentral.com. Email him at msouthard@gannett.com or follow him on Twitter at @Dargan_Southard.



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UConn wows with program-record 20 3s in win

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UConn wows with program-record 20 3s in win


UNCASVILLE, Conn. — No. 4 UConn sank a program-record 20 3-pointers in a 101-68 rout of Iowa State on Tuesday night in the second game of the Basketball Hall of Fame Women’s Showcase doubleheader.

The Huskies comfortably surpassed their previous season high of 14 3-pointers, converting 58.8% of their attempts (20 of 34) against the Cyclones, who were 8 of 25 from deep.

“Basketball is a make-shot, miss-shot game, and they made a lot of them, and that’s to their credit. They’re a great team,” Iowa State coach Bill Fennelly said. “They play the game the right way. So just nothing we could do to stop it.

“The way they shot the ball was unlike something I’ve seen in a long time.”

UConn sophomore Ashlynn Shade had seven 3-pointers en route to 27 points, both career highs.

“I really didn’t expect this. I thought we would have a difficult time,” UConn coach Geno Auriemma said. “I said, ‘We need to win the 3-point battle by quite a few because they make nine a game.’

“When the basket looks big early on, the basket just gets bigger as the game goes on, and for some players, they make their first two or three, they think they can make the next 23.”

Shade was 6 of 6 from beyond the arc in the first quarter, scoring 20 points.

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“It means everything to be a part of something that’s so big, being part of UConn history,” said Shade, who finished 7 of 10 from deep. “It’s just super surreal.”

The Huskies also got a quintet of 3s from freshman Sarah Strong (5 of 9, career-high 29 points) and senior Paige Bueckers (5 of 7, 27 points).

It marked the first time in the past 25 seasons that UConn had three players with at least 25 points in the same game. No other Division I team has had a trio of players do that this season.

Bueckers, Shade and Strong are also the first Division I trio with at least 25 points and five 3-pointers apiece in the same game over the past 25 seasons.

Freshman Allie Ziebell notched UConn’s 19th 3-pointer to set the program record (previously set in 2014-15 and 2008-09) with 3:19 left in the game, before classmate Morgan Cheli made No. 20 with 2:04 to go.

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“It would have been a bad game of H-O-R-S-E the way they were knocking them in,” Fennelly said.

Added Shade: “It was just super cool to be a part of and just such a fun game to play.”

The 3-point outburst from Shade in particular was welcomed, giving the Huskies a third major scorer. They’ve missed that recently with guard Azzi Fudd sidelined the past three games because of a knee sprain.

“I think we’re going to need three legitimate big-time scorers the entire season,” Auriemma said. “Where they come from, it really doesn’t matter to me, but hopefully we’ll have at least four maybe when Azzi gets back.”

UConn next faces No. 7 USC on Saturday in Hartford, Connecticut, in its second top-10 matchup this month. It lost to then-No. 8 Notre Dame last week.

No. 5 LSU beat Seton Hall 91-64 in the opener of Women’s Showcase earlier Tuesday.

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Information from ESPN Research was used in this report.



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