  We present a moderate-resolution spectrum of the peculiar Type II supernova
iPTF14hls taken on day 1153 after discovery. This spectrum reveals the clear
signature of shock interaction with dense circumstellar material (CSM). We
suggest that this CSM interaction may be an important clue for understanding
the extremely unusual photometric and spectroscopic evolution seen over the
first 600 days of iPTF14hls. The late-time spectrum shows a double-peaked
intermediate-width H-alpha line indicative of expansion speeds around 1000
km/s, with the double-peaked shape hinting at a disc-like geometry in the CSM.
If the CSM was highly asymmetric, perhaps in a disc or torus that was ejected
from the star 3-6 years prior to explosion, then the CSM interaction could have
been overrun and hidden below the SN ejecta photosphere from a wide range of
viewing angles. In that case, CSM interaction luminosity would have been
thermalized well below the photosphere, possibly sustaining the high luminosity
without exhibiting the traditional observational signatures of strong CSM
interaction (narrow H-alpha emission and X-rays). Variations in density
structure of the CSM could account for the multiple rebrightenings of the
lightcurve. We propose that enveloped CSM interaction as seen in some recent
SNe, rather than an entirely new explosion mechanism, may be adequate to
explain the peculiar evolution of iPTF14hls.
