New Doheny Meats owner explains his purchase of scandal-ridden store


Shlomo Rechnitz, a prominent local businessman and philanthropist, has purchased Doheny Glatt Kosher Meat Market, the scandal-plagued kosher meat retailer and distributor.

Rechnitz, who co-founded TwinMed, a large medical supply firm, and owns a number of other businesses, purchased the store and its distribution arm for an undisclosed sum from its former owner, Mike Engelman.

The sale closed late in the day on Sunday, March 31, just one week after its former kosher certifier, the Rabbinical Council of California (RCC), revoked the store’s certification and hours before the beginning of a two-day holy period celebrating the end of Passover.

Starting on March 25, the day after the revocation, rabbis from the RCC reached out to Rechnitz, urging him to buy Doheny, and in an interview with The Jewish Journal on April 3, Rechnitz said he initially considered making the purchase as “a favor to the community.”

[Related: After Doheny Kosher scandal, what does the future hold for L.A.’s meat market?]

“Before I came out with the announcement that I was going to purchase [Doheny],” Rechnitz said, “there were already stores calling up different distributors, even being quoted prices 35 to 40 percent higher than their current prices.”

Doheny is believed to supply as much as 50 percent of the kosher meat and poultry in Los Angeles; its disappearance would have significantly reduced competition in the marketplace, which, Rechnitz said, “would have destroyed the kosher market in Los Angeles.”

RCC President Rabbi Meyer H. May said Wednesday morning that he was one of those who personally urged Rechnitz to buy Doheny Meats, and he was cheered by news of the sale.

“It’s really extraordinary,” May said. “He’s going to preserve the richness of the meat supply and preserve the price structure for consumers.”

Rechnitz was involved in the response to the Doheny scandal from its earliest hours. He was one of a handful of non-rabbis who attended a hastily organized meeting on Sunday, March 24, when Engelman spoke to the RCC’s leadership and rabbis from synagogues around the Pico-Robertson neighborhood about what he had done at his store.

Engelman, who had owned the shop for 28 years, was videotaped by a private investigator last month bringing unidentified products into his store at a time when its rabbinic overseer was absent. Engelman did not return repeated calls requesting comment, and has not spoken on the record since the scandal began.

At the March 24 meeting, Engelman reportedly told Rechnitz, May, and the other laypeople and rabbis present, that he had, on two or three occasions, brought unsupervised meat into the store.

According to multiple people who attended the meeting, Engelman claimed all the meat he had brought to Doheny was kosher, but he admitted some was not up to the RCC’s higher “glatt kosher” standard. Glatt kosher meat is more expensive than kosher meat, which itself carries a higher price tag than equivalent non-kosher products.

Rechnitz said that he believes Engelman with “99 percent” confidence.

Rechnitz did add a caveat.  “You can’t rely on someone like me, who got my information from someone who unfortunately has made mistakes, who wasn’t always as truthful as he should have been,” Rechnitz said.

Over the course of a week of negotiations, Rechnitz spent between eight and 10 hours with Engelman; he said he does not believe Engelman brought the unsupervised products into Doheny to respond to specific customers’ requests, as some have suggested.

Rechnitz said Engelman himself couldn’t fully explain why he brought the unsupervised meat into the store, but Rechnitz speculated that it may have been due to anger Engelman felt towards his main supplier, Agri Star, the large kosher meat processor based in Postville, Iowa. In 2009, Agri Star bought the Postville plant from the bankrupt Rubashkin-owned firm AgriProcessors, which had been shut down in the aftermath of the largest immigration raid in American history.

Money may not have been the motivating factor, Rechnitz said, “because it wasn’t that much of a difference, based on the quantity.”

In the private investigator’s video, a Doheny employee was seen unloading eight boxes from Engelman’s SUV and bringing them into the store. Based on additional videos received from the investigator, the May said the RCC estimates Engelman brought a total of approximately 1,200 pounds of animal products into the store over the weeks he was under surveillance.

Although Rechnitz’s initial reason to purchase Doheny was to maintain competing distributors for the city’s kosher-observant community, over the course of the week of negotiations he became a bit more optimistic about the business prospects for the company.

“I didn’t have time to send in a forensic accounting team,” he said, but Engelman told him that Doheny’s gross sales on the retail and distribution sides added up to approximately $8 million a year.

That said, Rechnitz said he hopes to remain a mostly silent investor in Doheny, and won’t aim to build its market share at the expense of other distributors.

Engelman won’t have any role in the business – Rechnitz said the agreement required the former owner to make a “complete” break, and included a non-compete clause – but the rest of the operation should remain mostly the same.

The RCC will once again certify Doheny’s retail and distribution operations, the name will remain the same and every current employee, Rechnitz said, has been offered his job.

The store, which is currently closed, could reopen as early as next Monday; Rechnitz said that the store, the utensils and dishes used there were being kashered — ritually cleansed — “just in case there was non-kosher meat being used.”

Rechnitz is currently Doheny’s sole owner; he said he is in negotiations with another investor who might buy into the business. The deal with Engelman included a non-disclosure agreement about the price, Rechnitz said, but he described the negotiations as “amicable” and described the final selling price as “sizable,” but not as big as it might have been prior to the scandal.

“It definitely came at a major discount due to the fact of what [Engelman] did, or what he tried to get away with,” Rechnitz said. “He definitely was not rewarded for his actions.”

Rechnitz has experience working with organizations at times of crisis. In his role as CEO of one of his companies, Brius Management Co., which manages multiple nursing homes across California, Rechnitz told a reporter in 2011 that his company looked mostly for “distressed facilities.”

In his philanthropic work, Rechnitz has also come to the aid of embattled organizations. Last year, in the wake of Hurricane Sandy, Rechnitz donated $1 million to an organization that supports Jewish day schools in the New York area. In 2011, Rechnitz donated $5 million to the Mir Yeshiva in Jerusalem, which was struggling under millions in debt following the death of its chief rabbi and fundraiser. That same year, Rechnitz also helped save Chabad of California’s headquarters from foreclosure.

But Rechnitz is also known for charitable giving of a very different sort. Every Saturday night, Jews line up outside his family’s home. Until six months ago, those who came walked away with checks; now they leave with gift cards to one of two kosher markets in the area near Fairfax and La Brea.

Rechnitz announced his purchase of Doheny at his synagogue on Sunday evening, March 31, just hours after the deal closed. He said the reaction there was muted – “It was kind of almost expected,” Rechnitz said, adding that his goal in making the announcement was to change the conversations that observant Jews in Los Angeles were bound to have over the two days that followed, the last two days of Passover, during which work and the use of any electronics is prohibited.

“I wanted to stave off two days of people creating rumors and completely defaming the place,” Rechnitz said.

In that regard, Rechnitz appears to have succeeded already. Just hours after Passover ended on Tuesday, April 2, after sundown, at least one person had reported the news in a comment on Facebook.

All Saints’ IRS Fight Gets Jewish Support


For a church facing an assault from the Internal Revenue Service, the outspoken clergy of All Saints Episcopal Church in Pasadena acted neither fearful nor repentant Sunday.

The IRS is “welcome in our pews,” said Rector J. Edwin Bacon to loud applause, but “not welcome in our pulpit.”

The IRS has threatened to revoke the church’s tax-exempt status for speaking out strongly on political issues. But Bacon showed no signs of backing down. And based on the reaction from the Southern California rabbinate, rhetorical reinforcements are already in place.

The IRS dispute arose out of an anti-war sermon given by the Rev. George Regas on the eve of the 2004 presidential election. The IRS interpreted the impassioned homily as an endorsement of John Kerry over incumbent President George W. Bush. Tax-exempt nonprofits, such as churches and synagogues, are not allowed to endorse candidates.

Bacon told the packed congregation last weekend that the church is “energetically resisting” the attack on its tax-exempt status. If left unchallenged, the IRS action “means that a preacher cannot speak boldly about the core values of his or her faith community without fear of government recrimination.”

Bacon added that All Saints has received a “surprising outpouring of solidarity” from a “host of other believers.”

Jewish leaders are among those speaking out against the IRS action. They say that their own synagogues, too, could become targets.

“I would have given the sermon that Regas gave with honor,” said Rabbi Steven Jacobs, of Congregation Kol Tikvah in Woodland Hills. He added that he regularly gives sermons that “challenge my congregation” by addressing difficult political issues. If these sermons have reached the attention of the IRS, he doesn’t know about it.

Jacobs said he hopes that the controversy will stir rabbis and other religious leaders to take more chances in their sermons and not cower in face of intimidation.

“There is a great risk to our personal souls if truth has to be suppressed and doubt unspoken, “Jacobs said. “When ‘united we stand’ means everyone must think alike, something is seriously wrong with our democracy. Jeremiah spoke truth to power in the Babylonian times and All Saints is doing it now.”

It was two days before the 2004 election that Regas, All Saints’ former rector, gave a guest sermon in which he imagined a debate between Jesus and then-candidates George W. Bush and John Kerry. Regas harshly criticized the government’s record on poverty, abortion and nuclear arms, but his most pointed remarks concerned the war in Iraq. He said Jesus would have told Bush, “Mr. President, your doctrine of preemptive war is a failed doctrine [that] has led to disaster.”

The Sept. 11 attacks did not justify “the killing of innocent people” in Iraq and elsewhere, he added.

In that sermon, Regas also said he did not endorse either candidate, but he asked the congregation to take “all that you know about Jesus, the peacemaker” to the ballot box and “vote your deepest values.”

The IRS viewed the sermon as a possible endorsement of Kerry. In June, it sent a letter telling the church that it “may not be tax-exempt as a church” because Regas’ remarks raised questions concerning the church’s “involvement in … political campaign intervention.”

The federal tax code permits tax-exempt organizations to speak out on political issues but not to endorse candidates. The IRS has recently investigated more than 100 nonprofits, including the NAACP, for possibly promoting candidates, according to published reports.

So far, there’s been no public indication that the targets have included synagogues, said Rabbi Mark Diamond, executive vice president of the Southern California Board of Rabbis. Nevertheless, he and other Jewish leaders have been quick to stand behind All Saints Church.

“I spoke with Rev. Bacon and assured him of our support,” Diamond said. He added that he is working with other rabbis and religious leaders to develop a coordinated response across political and denominational boundaries. “Tomorrow the IRS may well target a conservative Baptist congregation in the South,” he said.

Leonard Beerman, rabbi emeritus of Leo Baeck Temple in Bel Air, has an especially close tie to All Saints, where he serves as rabbi-in-residence.

The IRS investigation is a “selective application of the law,” he said, and a “deliberate act of attempted intimidation” against clergy who criticize the administration. “No one’s going to intimidate this church, but some churches and synagogues may be intimidated.”

“I don’t think we give up free speech because the president has chosen to go to war,” Beerman added. “Regas wasn’t telling people how to vote. He was critiquing the lies that brought us into the war and the impact of the war on American and Iraqi life. This fundamental belief in the sanctity of every life lies at the heart of the Jewish and Christian tradition and is what propels Regas and I to be opposed to war.”

The IRS has denied any political motivation to its tax probes.

As it happens, the joint activism of Beerman and Regas reaches all the way back to a raucous anti-Vietnam War rally in Exposition Park in 1973.

“Regas got up to speak in his Episcopal collar and he put his whole body into the speech,” Beerman recalled. “Immediately we were drawn to each other and we became engaged together in opposition to the war.”

The two have worked together on anti-war and other causes ever since.

For some rabbis, the controversy highlights the duty of Jewish leaders to take risks by speaking out.

“The Jewish tradition teaches that silence is riskier than the wrath of opposition,” said Rabbi Haim Dov Beliak, of Congregation Beth Shalom in Whittier. “It’s from the prophets and the rabbinic tradition. Leviticus says you shall not stand idly by the blood of your brother.”

Nevertheless, “instead of being leaders, most rabbis have decided not to make waves” since the war started, Beliak said.

The sermons of Rabbi Steven Leder generally deal with “more timeless issues of the human condition and spirit,” as opposed to politics. Nevertheless, Leder can see an instance where he would make an exception. He said he would ask his Wilshire Boulevard Temple congregation not to vote for someone like David Duke, the open anti-Semite who ran for office in Louisiana.

During the summer, the IRS offered to settle with All Saints “by having us say that we were wrong and would never do it again,” Bacon said. The church refused.

The IRS’s demand for an admission of wrongdoing “reminds me of something out of the loyalty oaths of the 1950s,” USC law professor Ed McCaffrey said.

The church’s response was the right one, said Diamond: “The settlement offer is very dangerous because the case is truly about freedom of the pulpit. For members of the clergy to be stifled in expressing deeply held religious and moral views is blasphemous.”

“Rather than intimidate rabbis [or anyone else],” he said. “It’s made a whole lot of clergy persons mad as hell.”

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