Aleph Meats Takes MK to Competition Tribunal, Alleging It Is Being Shut Out of Montreal Kosher Market

By Joseph Marshall

A fight over kosher meat, certification and who gets to sell what in Montreal is about to move out of the community and into the legal system.

Aleph Meats says it intends to file a complaint with the federal Competition Tribunal today against the Jewish Community Council of Montreal, the organization that operates MK Kosher. The company is accusing MK of using its dominant position in Montreal’s kosher market to prevent stores, caterers, slaughterhouses, synagogues and other organizations under MK supervision from doing business with Aleph because its meat carries a different kosher certification.

Aleph Meats, headed by Mendy Boyarsky, operates under KSR, Kosher Supervision of the Rabbinat, led by Rabbi David Sabbah. Boyarsky says he started the company to bring lower-priced kosher meat into Montreal, where the cost of meat has become a serious issue for many families. In a letter being circulated to members of the Montreal Jewish community, he argues that instead of being allowed to compete for those customers, Aleph has repeatedly found doors closed to it because businesses fear jeopardizing their relationship with MK.

That is also at the heart of the legal complaint. Aleph alleges that MK prevents businesses under its certification from doing business with suppliers whose products carry another kosher certification, effectively making MK certification a requirement for anyone hoping to sell through much of Montreal’s established kosher network.

The filing names Montpak International, several IGA stores, Cité Cachère and a number of Montreal synagogues and event venues among the organizations Aleph says it has been unable to do business with. The fact that those organizations are named does not mean Aleph is accusing them of wrongdoing, its argument is that they are themselves operating under rules imposed by MK and, according to Aleph, have little choice if they want to maintain that certification.

Aleph says some businesses have been quite open about the problem. The material filed in support of the application includes a recorded conversation with a representative of IGA Van Horne and a voice message from a representative of Cité Cachère. In the IGA conversation reproduced in the court documents, the representative explains that the entire store is MK certified and acknowledges that bringing Aleph’s products into the store would create a problem. The Cité Cachère representative is considerably blunter, telling Boyarsky that because the business is under MK, it cannot use or sell his meat.

Perhaps more important is a video from MK itself which Aleph has included as an exhibit. According to the filing, MK director Rabbi Saul Emanuel says that MK allows only meat approved and certified by MK to be sold in Montreal establishments certified by the organization.

On its own, however, that does not necessarily make MK unusual.

Kosher certification agencies routinely control which meat, and other products may enter establishments under their supervision. A restaurant cannot simply decide that because another rabbi or agency considers a product kosher, its own certifying agency must accept it. STAR-K, one of the major American kosher agencies, for example, requires meat entering its certified restaurants, caterers and retailers to come from sources that STAR-K has either certified or specifically approved. STAR-K also says it reviews meat carrying other kosher certifications and can approve those products if they meet its standards.

The distinction is fundamentally important because the case is not really about whether MK has the right to establish its own standards of kashrus. It obviously does. The question Aleph is putting before the Competition Tribunal is whether a kosher certifier with enormous influence over a local market can use those standards in a way that effectively prevents another kosher certifier, and companies using that certification, from competing.

Aleph estimates in its complaint that MK controls between 85 and 95 percent of the relevant kosher certification market in Greater Montreal. The complaint argues that the concentration is so great that a company choosing another hechsher may technically remain kosher, but practically lose access to many of the stores, caterers and institutions through which Montreal’s kosher consumers buy food.

Boyarsky is aggressively making the case that Montreal families are paying far too much for kosher meat. In his community letter, he claims kosher meat can be approximately 70 percent cheaper in the United States, that meat from the same supplier serving Montreal is sold elsewhere at roughly half the Montreal price, and that meat from that supplier can be about 30 percent cheaper in Toronto.

Those price comparisons are Boyarsky’s and do not appear in the Competition Tribunal complaint reviewed by the Montreal Jewish News.

Aleph says limiting competition reduces choice and contributes to the higher prices being paid by Montreal kosher consumers. The filing argues that the alleged restrictions leave consumers with fewer options and suppliers with fewer ways to reach them.

MK may have a very different explanation, a kosher certifier could argue that controlling which meat enters establishments under its supervision is not an attempt to control the market at all, but one of the basic responsibilities for which the certifier is being hired. If an organization puts MK’s name on the door, MK is ultimately responsible for telling consumers that everything being sold under that supervision meets its standards.

Aleph’s response is essentially that the Competition Act does not stop applying simply because the service being provided happens to be religious certification. Its complaint alleges exclusive dealing under section 77 of the Competition Act and abuse of dominant position under section 79, arguing that MK’s rules go beyond protecting its own kashrus standards and have the effect of shutting competing certifications and suppliers out of the market.

The company says it tried to resolve the dispute before going legal. Boyarsky states in his affidavit that Aleph sent the Jewish Community Council a formal letter on June 20 demanding an end to what it described as anti-competitive practices but received no response and saw no change afterward.

Aleph is asking the Competition Tribunal to order MK to remove formal or informal barriers preventing MK-certified businesses from dealing with suppliers carrying another kosher certification. It is also seeking an interim order that would impose similar restrictions on MK while the case works its way through the Tribunal, along with financial remedies available under the Competition Act if Aleph ultimately proves its allegations.