Why is Kosher Food So Attractive… and Profitable?

The religious procedure most universally associated with Judaism is the intricate dietary laws many Jews observe — kosher.

Over the past twenty-five years, the demand for kosher certified products has increased dramatically.[1] As of 2014, more than 40% of the United State’s new packaged food and beverage products are labeled as kosher. Further, there are approximately 12 million kosher consumers in the United States.[2] At any given time, 21% of Americans either regularly or occasionally purchase kosher products because they are kosher.[3]

The number of kosher products in U.S. supermarkets exceeds 125,000.[4] The value of the U.S. kosher market is also very significant- the dollar value of kosher market exceeds $12 billion dollars while enjoying an annual growth of approximately 15%.[5] In comparison, non-kosher food sales in American supermarkets are growing at approximately 4% a year.[6]

In order to meet this demand, companies are pursuing kosher certification in order to magnify their existing market and improve sales strategies. A certificate assuring kosher can now be found on hundreds of thousands of processed foods including restaurants, airlines, hotels, and caterings throughout the world.

Non-Jewish Consumers

An increasing number of non-Jewish consumers also purchase kosher food today because they perceive it as better quality and healthier.[7]

Because the Food and Drug Administration has many issues dealing with stereoids and drugs, many consumers believe that current food standards do not adequately supervise the food market as they should.

For many kosher food consumers, the kosher designation serves as a check. Kosher designation means that a rabbi has been to the food processor’s company and has inspected the equipment. This leads many consumers to determine that the product is going to be more clean and healthier.

Business Motivation Behind Kosher

Business motivation is the primary reason for the increased number of kosher certified products and food processors seeking kosher certification.

Rabbi Hillel Klavan, chairman of the Rabbinical Council of Greater Washinton, explains that, “very few of these establishments are in it for the love of religion. It’s a marketing system, a profit-making endeavor.”[8]

Many food processors try to separate themselves from the rest of the kosher food market by attaching their own kosher seal of approval. For example, Rabbi Menachem Genack’s seal of approval, a circle with a U inside, is the best known and most widely used kosher food symbol.[9]

Many companies have benefited from placing kosher designations on their packaging. For example, a study done by Dannon Yogurt Company showed Empire Kosher Poultry Inc.’s sales jumped 14% to $7 million by entering their frozen pizzas and prepackaged luncheon meats into the kosher food market.[10] It does not cost much to be labeled as “kosher” and the labeling may bring higher sales. “With companies very aggressive in terms of trying to gain market share, even the smallest edge… is significant.”[11]

Regulation of Kosher Labeling

It was exactly this profit-seeking incentive that encouraged the State of New York to enact legislation in 1915 regulating the sale of kosher food products.[12]

In the late nineteenth century, profiteers were passing off non-kosher food as kosher.[13] The State of New York wanted to prevent such misleading and fraudulent practices in order to protect the consumer by regulating the market.

A number of states followed New York, adopting kosher food laws modeled after the New York Statute.[14] Since the enactments of these legislations, there have been many various constitutional challenges to these kosher food laws based on the Equal Protection, Due Process, vagueness, and First Amendment grounds.[15]

Until the New Jersey Supreme Court case of Ran-Dav’s County Kosher, Inc. v. State of New Jersey, courts had consistently upheld the constitutionality of kosher food laws.[16] The decision in Ran-Dav was the first time that a kosher food statute was struck down.

In this case, the New Jersey Supreme Court decided that a New Jersey statute regulating the sale of kosher food was unconstitional since it violated the Establishment Clauses of both the federal and state Constitution.[17] This decision was significantly important because it called into question the validity of other states’ kosher food laws which were similar to New Jersey’s law.

Understanding the Concept of Kosher

What is Kosher?

The Hebrew word “kasher”- or kosher- means fit or proper.[18] Food is kosher when it meets the strict dictates of the laws of “kashrus.”

The laws of kashrus require that kosher food:

  1. Come from a proper source. For example, meat from some animals, such as pork, is essentially non-kosher.
  2. Kosher food needs to be prepared in a specific manner. For example, animals must be slaughtered in a particularized manner, and
  3. Kosher food cannot be combined improperly with food that might otherwise be considered kosher. For example, combining meat and milk is considered improper.

Around the world, most of the food eaten by consumers are processed, canned, or refined. Furthermore, most of our food has crossed many state and even international borders before arriving at supermarket, restaurants, and local groceries.

These societal advances present a hurdle for those who wish to follow a kosher diet. “A shopper has no way of knowing exactly what ingredients is contained in the food she buys.”[19] Even though general consumer protection guidelines assist the kosher consumer, they fall short of providing the information consumers need to know.

For example, current federal labeling requirements do not require that all ingredients be identified.[20] And even if all ingredients are known, the use of industrial-sized equipment in plants creates many transference difficulties. Thus, the increased dependence on mass production diminishes the kosher consumer’s options considerably.

Fortunately for those who keep a kosher diet, myriad kosher supervision and certification have emerged to allow these consumers access to a greater variety of food.

Who Certifies Kosher Food?

Individual rabbis or rabbinical organizations enter into agreements with the owners of food producers, processors, and food businesses.

For a fee, the rabbi or organization supervise the food process and certify that the food meets the requirements of kashrus.[21] To avoid corruption, Jewish law mandates that the certifier be independent and not have a stake in the business being certified.

Whether the food is actually kosher or not is based on the copious kashrus requirements mentioned above. “Food may or may not be kosher, and consumers have no ability to discern the truth.”[22] Through various certificates, letters, or symbols, certifiers indicate to consumers that they consider food kosher for consumption.

Identifying Kosher Symbols and Organizations

There are over three hundred registered kashrus symbols used by Kosher Supervision Agencies (KSAs) in the United States.[23]

Most Kosher Supervision Agencies have registered their trademark with the United States Patent Office so their name is protected by trademark law, not allowing others to use their name or brand without their permission.

The most dominant organization in the supervision industry is the Kashruth Division of the Union of Orthodox Jewish Congregations of America. This organization is better known by their trademark, the “OU.”[24] Approximately 75% of the packaged kosher food found today on supermarket shelves is certified by the OU.[25]

Furthermore, in some regional markets, the OU certificates at least one third of the items one would find at any given on any given shelf of a supermarket.[26]

Three other KSAs are prevalent in the kosher certification industry- KOF-K Kosher Supervision, Star-K Kosher Certification, and the Organized Kashrus Laboratories (OK).[27] According to some estimates, the “Big Four” organizations certify 90% of the kosher products in the market.[28]

The KSA kosher certification organizations not only indicate the identity of kosher products, but they also provide additional information regarding the product.

For example, the word “pareve”- routinely identified with the letter “P”- can be used to identify the neutral category of food that is considered neither meat nor dairy. KSAs may also use the letter “D” or word “dairy” to identify foods that are considered dairy under the laws of kashrus.

Furthermore, some KSAs also use “DE” to identify a nondairy food product produced using equipment that has been previously used to manufacturer dairy products. However, “neither the tags themselves nor the nature of their usage is standardized between competing KSAs.”[29]

Who is the Kosher Food Consumer?

While many kosher food patrons regularly purchase food to fulfill their religious dietary requirements, the great majority of kosher food consumers make their decisions based on criteria other than their religion.

While approximately 6 million Americans consciously seek kosher food in the supermarket, yet only 1.5 million of them are of the Jewish faith.[30] In fact, the majority of kosher food consumers purchase kosher food because they believe it to be of a greater quality and healthier than non-kosher food.[31]

Conceivably this trend is due to the belief that there is a greater degree of attention in the preparation process of kosher products. Many individuals purchase kosher products for dietary reasons such as those who are allergic to certain types of seafood or those who are lactose-intolerant.

Such dietary purposes additionally demonstrate that consumers of kosher food are not necessarily Jewish, and are not selecting kosher food for any particular religious purpose.

Market estimate report that Jews account for some 30% of kosher food consumers.[32] Moreover, some Jewish consumers almost exclusively buy kosher and are intensely dependent on the kosher food industry. What is significant here is that those independent on kosher food represent less market participation than their numbers suggest.

In 2002, of the $6.65 billion spent by kosher product consumers, Jewish consumers spent $3 billion, or 45%.[33] That is to say, while Jews represent fewer consumers, they are buying disproportionately more kosher food than their numbers suggest.

The reason consumers buy kosher food is significant. For example, the risk the consumer is willing to take with regard to fraud or mistake, and the extent of the dependency the consumer must take on the kosher food industry are all factors which must be considered and analyzed. While observant Jews only represent one-third of the people who intentionally buy kosher food, their stake in their faith in the authenticity of kosher-labeled products is highly significant.

How to Safeguard the Public from Being Deceited

The implication of kosher food fraud depends on what “kosher” means to consumers of kosher food. The word “kosher” means “proper” or “fit” under Jewish dietary laws. These dietary laws were derived from the Torah, the Jewish bible, and have been followed by Jewish people for thousands of years.

Although members of Judaism generally agree as to what constitutes as kosher food and what proper kosher food preparation is, disagreements sometimes arise as to whether particular foods are kosher, or have been prepared according to specific obligatory procedures.

Furthermore, there is a considerable amount of variance within the Jewish population with regard to knowledge and application of the laws of kashrus.

While the bulk of consumers who exclusively purchase and eat kosher food are the most “sophisticated consumers” within the food industry, many may not be experts on the intricacies of kashrus.[34] While many might not understand the particularities of kashrus, these kosher consumers know more of the rudimentary rules and recognize most of the KSA symbols.

There are also differences between the standards of kashrus required by orthodox and conservative Judaism.

While some may consider these differences negligible, these gradations are very important to the observant individual. Furthermore, these disparities have led to the constitutional confrontations on kosher fraud statutes.

Many Orthodox communities take an active role in regulating the food of their localities. For example, community leaders may notify the consumers when the food has been falsely misrepresented as kosher.

Furthermore, many kosher food consumers in Orthodox Jewish communities only consume food products that have specific certifying marks approved by their individual rabbi. This practice of self-regulation is a form of protection from kosher food fraud for a limited number of kosher food consumers. However, such practice does not help individuals outside an Orthodox community.

Consequently, it appears that the largest group of kosher food consumers, those including health-conscious, allergy sufferers, Muslims, or those striving out what they consider to be higher quality food, are forced to rely on representations made by vendors that products are in fact kosher as advertised.

In consideration of these factors, it becomes clear that the consumers who are most likely to be affected by kosher fraud, the non-Jewish kosher food consumers, are least likely to be able to safeguard themselves from it.

The purpose behind consumer protection law is to safeguard the general public from purchasing misleadingly represented products.[35]

“In the eyes of many consumers, most of whom are unable to verify the quality of the products they are purchasing, ‘perception is reality.’”[36] On the federal level, in 1914 Congress created the Federal Trade Commission (FTC) to ensure fair competition in the marketplace.[37]

In 1938, Congress extended the role of the FTC to include warranting “unfair or deceptive acts or practices in commerce.”[38] These regulations show Congress’s concerns for consumers. More specifically, it is evident that the law respects promises to buyers to prevent dishonesty in the marketplace. Consumers of kosher food are similarly susceptible to deceptive consumer practices and are entitled to no less protection from fraud than are consumers of any other product on the market.

Whatever reasons a consumer may have for purchasing a particular products, whether it is for religious reasons or nutritional supplements, the state has an interest in protecting its residents from deceitful sellers who, without government involvement, will certainly take advantage of the innocent consumer. Consequently, there are significant policy reasons behind the state regulating the sale of kosher food such as the strong interest in preventing fraud.

However, even assuming that the State has a compelling interest in the prevention of fraud in the kosher consumer market, most of the statutes concerning kosher fraud are not adequately well tailored to further that interest. Laws modeled after the original New York kosher statute rely on the state to ensure that kosher food is actually kosher. However, such statutes involve the state directly in deciding religious matters.

There are good examples that States can follow to protect the consumer. The State can ensure that consumers have correct and adequate information to make decisions when purchasing food labeled as kosher by passing laws that simply assure that a product claimed to be certified as kosher by a specific authority is indeed so certified. Following decisions in Ran-Dav’s, Barghout, and Commack, New York, New Jersey, Virginia, and Georgia amended their kosher food laws.[39]

The amended laws require that the packaging or the vendor itself present information clarifying to the consumer to the basis for the claim that the food is kosher. The information would include the name and contact information of the certifying authority.

Furthermore, it could also be extended to include a Web address for an archive of additional information about the standards. This would not only safeguard the general public, but it would also allow the individual consumer to determine for him or herself whether that authority’s definition of kosher conforms to his or her specific needs in purchasing kosher products.

Furthermore, after the New Jersey Supreme Court struck down its kosher fraud statute in Ran-Dav’s County Kosher, Inc. v. State, the New Jersey legislature enacted the “Kosher Food Consumer Protection Act,” a statute that requires any dealer using the term “kosher” to exhibit a disclosure of the standards used to and to keep records that enable the attorney general to ensure compliance with this requirement.[40]

The standards are achieved through the use of a series of questionnaires that ask the certifier to answer to discern how rigorous the supervision and certification is. This procedure shifts the state’s regulatory control from food manufacturers and retailers towards certifiers and KSAs.

The disclosure standard addresses several of the problematic concerns faced by kosher consumers mentioned above. Mandatory disclosure can help consumers overwhelmed and perplexed by the intricacies of kosher food by detailing the sources of the product as well as the standards used to make the food “kosher” according to the individual’s customs.

Though many Orthodox Jews support the kosher fraud statutes, no observant Orthodox Jew would assume the product is kosher simply because a vendor has labeled it as “kosher.”

Recently, as Jews throughout Southern California were preparing to celebrate Passover, a prominent kosher meat distributor in the community of Los Angeles, California was stripped of its kosher certification.[41] Doheny Glatt Kosher Meats was a wholesale supplier of kosher products to restaurants, caterers, and merchants. Doheny Glatt was accused of repacking kosher meat boxes with USDA products that were not kosher. Such misfortunes leave room for concern over whether products labeled as “kosher” are actually kosher. Furthermore, an Orthodox Jew would first want to know which Orthodox Rabbi certifies that it is in fact kosher.

One kosher certification organization making a strong name for themselves in kosher certification is Kosher 90210. According to Kosher 90210, Kosher 90210 is an “upscale kosher certification & lifestyle company for food establishments in an era where health consciousness and educated consumers are aware of the many benefits of eating kosher.”

According to Benjamin Illulian, Kosher 90210’s Director of Operations, kosher certification should go beyond the average means of certifying that certain products are considered kosher according to orthodox Jewish definition — Kosher 90210 delivers high-quality and responsible handling of making sure kosher consumers are protected to their high expectations.

Since the emergence of kosher fraud statutes, an Orthodox standard has been in effect. However, this standard did not and does not assure Orthodox Jews that food labeled as “kosher” is necessarily fit for Jewish consumption. “For the Orthodox, then, the real opportunity for fraud is not in labeling food ‘Kosher.’ It is in claiming (perhaps falsely) that a particular Rabbi or group has certified its Kashrut.”[42]

Kosher fraud statutes are meant to guide those who are not especially observant but who frequently observe to some version of Jewish tradition. If food products labeled “kosher” in the supermarket must conform to Orthodox standards, then alternate approaches are thus discredited. Through the partition, the government thus becomes a voice in spreading the message that the only acceptable Jewish observance is Orthodox.

Last Words & Advice for the Future of Kosher

Because the kosher food market is a multi-billion dollar industry in America, manufacturers traditionally have undoubtedly succumbed to the temptation of fraudulently labeling food as being kosher without satisfying the strict guidelines of kashrus.

In order to protect innocent buyers of kosher food from fraud, supervisory and certification organizations have been established to certify that the food meets the requirements of kashrus. Consequently, at least twenty-two states have enacted some form of kosher food consumer protection statutes.[43]

However, most of these statutes use a controversial language that generally defines kosher as “prepared in accordance with Orthodox Jewish religious standards.”[44] Since then, many kosher fraud statutes have been struck down under the Establishment Clause asserting that kosher fraud laws “foster excessive entanglement and advance religion.”[45]

However, whenever a consumer purchases a particular product, the state has an interest in protecting its residents from deceitful sellers, which without government involvement, will certainly take advantage of the innocent consumer.

There is a strong interest in prevention of fraud and the government can alleviate these concerns through mandatory disclosure statutes.

Through the use of mandatory disclosure statutes, the state can ensure that consumers have correct and adequate information to make decisions when purchasing food labeled as kosher by passing laws that simply assure that a product claimed to be certified as kosher by a specific authority is indeed so certified.

Mandatory disclosure statutes would require that the packaging or the vendor itself present clear information to the consumer about the source of the certifying authority and any additional information about the standards.

Such a practice would not only safeguard the general pubic, but it would also allow the individual consumer to determine for him or herself whether that authority’s definition of kosher conforms to his or her specific needs in purchasing kosher products, without violating the Establishment Clause of the United States Constitution.

QUESTION: Do you agree or disagree?

Join the coversation at #truekosher or comment below to continue the story.

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Sources:

Please note: some facts & figures from the story were researched in 2013. It’s safe to assume that the prevalence of kosher has increased since.

[1] The Global Demand for Kosher. Kosher Market. Feb. 18, 2003. http://www.star-k.org/ind-advantages-market.htm

[2] Kosher Industry Facts. Kosher Fest: The Business of Kosher Food & Beverage. http://www.kosherfest.com/about-kosher

[3] Id.

[4] Id.

[5] Id.

[6] Shimoni, Giora. 10 Most Interesting Kosher States of 2006. http://kosherfood.about.com/od/kosherbasics/p/kosherstats.htm

[7] Mayer, Caroline E., Rabbis’ Seal of Approval, Who’s Keeping Kosher Now?, Washington Post, September 27, 1989, at E1.

[8] Id. at E2.

[9] Id.

[10] Hwang, Suein L., Kosher-Food Firms Dive Into Mainstream, Wall Street Journal, April 1, 1993, at B1.

[11] Mayer, Caroline E., Rabbis’ Seal of Approval, Who’s Keeping Kosher Now?, Washington Post, September 27, 1989, at E2.

[12] Stern, Marc D., Kosher Food and the Law, 39 Judaism 389, 389 (Fall 1990).

[13] Id.

[14] Id.

[15] Kellett, Earl L., Validity and Construction of Regulations Dealing with Misrepresentation in the Sale of Kosher Food, 52 A.L.R. 3d 959 (1973).

[16] Id.

[17] Ran-Dav’s Country Kosher, Inc., 608 A.2d at 1366.

[18] Sigman, Shayna M., Kosher Without Law: The Role of Nonlegal Sanctions in Overcoming Fraud Within the Kosher Food Industry, Florida State University Law Review 31 (2004), 517.

[19] Id. at 524.

[20] Federal Food, Drug, and Cosmetic Act (FDCA), 21 U.S.C. §§ 342–343 (2002).

[21] Sigman, Shayna M., Kosher Without Law: The Role of Nonlegal Sanctions in Overcoming Fraud Within the Kosher Food Industry, Florida State University Law Review 31 (2004), 524.

[22] Id. at 525.

[23] Who’s Who in Kosher Supervision?, Kashrus Magazine, Nov. 1993, 30–42.

[24] Eidlitz, Rabbi E., Ist It Kosher? Encyclopedia of Kosher Foods Facts & Fallacies (1992), at 21.

[25] Orthodox Union Department of Public Relations, New Company and Plant Certifications Solidy Orthodox Union as Leaders of the Kosher World, Jan. 17, 2001, at httyp:wwww.ou.org./oupr/20001/ouko01.htm

[26] Sigman, Shayna M., Kosher Without Law: The Role of Nonlegal Sanctions in Overcoming Fraud Within the Kosher Food Industry, Florida State University Law Review 31 (2004), 526.

[27] Id.

[28] Id.

[29] Id. at 528.

[30] Mayer, Caroline E., Who’s Keeping Kosher Now? Manufacturers Value Rabbi’s Seal of Approval, Washington Post, September 27, 1989, at E2.

[31] Id.

[32] Sigman, Shayna M., Kosher Without Law: The Role of Nonlegal Sanctions in Overcoming Fraud Within the Kosher Food Industry, Florida State University Law Review 31 (2004), 538.

[33] The Kosher Food Market in the U.S.A.: Dollars Spent by Consumers Who Look for Kosher Food Products, at http://wwww.koshertoday.com/resourcecenter/charts/dollarsspentconsumr.htm.

[34] Sigman, Shayna M., Kosher Without Law: The Role of Nonlegal Sanctions in Overcoming Fraud Within the Kosher Food Industry, Florida State University Law Review 31 (2004), 538.

[35] Charles of The Ritz Distribs. Corp. v. Fed. Trade Comm’n, 143 F.2d 676, 679 (2d Cir. 1944).

[36] Jacobson, Jared, Commack Self-Service Kosher Meats, Inc. v. Rubin: Are Kosher Food Consumers No Longer Entitled to Protection From Fraud and Misrepresentation in the Marketplace?, St. John’s Law Review, Issue 3 Volume 75, 2012.

[37] Federal Trade Commission Act of 1914, 38 Stat. 719 (1914), as amended, 15 U.S.C. § 45(a)(1) (1982).

[38] Fed. Trade Comm’n v. Colgate-Palmolive Co., 380 U.S. 374, 384 (1965).

[39] 2004 N.Y. Laws 151; 1994 N.J. Laws 138; 2006 Va. Acts 485; 2010 Ga. Laws 372.

[40] N.J. Rev. Stat. § 56:8–63 (2003); N.J. Admin Code tit. 13, §§ 45A21.2, -21.4 (2003).

[41] Costello, Carolyn. L.A. Kosher Meat Distributor Stripped of Certification. KTLA News. http://ktla.com/2013/03/24/l-a-kosher-meat-distributor-stripped-of-certification/#axzz2OZ3HLH00

[42] Colb, Sherry F.. Why Kosher Fraud Statutes Aren’t Kosher: The Second Circuit Enforces The Separation of Church and State. June 5, 2002. http://writ.news.findlaw.com/colb/20020605.html

[43] Milne, Elijah L.. Protecting Islam’s Garden from the Wilderness: Halal Fraud Statutes and The First Amendment. Journal of Food Law & Policy. Spring 2006.

[44] Commack Self-Service Kosher Meats, Inc., 106 F. Supp. 2d at 448.

[45] Id. at 456.