Are capitalist robber barons conspiring to ruin Passover? The state of Florida wants to know. This Passover season, the state attorney general's office launched an investigation into possible antitrust violations in the matzo manufacturing and distribution system. Price fixing is one possible explanation for the observation that a box of matzo in a supermarket in South Florida can cost $12 to $13, while up in New York it might be only $4.00 to $5.00, says Assistant Attorney General Robert J. Buchner. (The fact that the matzo is manufactured in New York and New Jersey and then shipped down south shouldn't matter, Buchner thinks.)
So far the state has subpoenaed America's two biggest matzo manufacturers, Manischewitz of New Jersey and Aaron Streit Inc. of New York, and various distributors.
"It's just some people who want to get re-elected," grouses Mel Gross, vice president at Steit. "They wanted records about our prices. We sell at the same price to everyone. We're not responsible for what stores charge. I find it troubling that politicians can't figure this kind of thing out without spending taxpayer money."
Elliot Silverman, Manischewitz's attorney, also asserts that "Manischewitz has nothing to do with the price that wholesalers charge to retailers or retailers to the public. To the extent there are differences in retail price, that's nothing to do with Manischewitz." Manischewitz paid a fine in a federal antitrust investigation in 1990, but Silverman stresses that the company has been sold since then, and its management has completely changed.
Buchner can't say specifically how the investigation might proceed, but if any company is found guilty of knowingly fixing prices, it could face up to $1 million in fines, and its officials could receive as much as three years in prison. Florida is also investigating price fixing in the toilet paper industry.