Monday, June 22, 2020

Sorry, Charlie.

My mother - both a child of the Depression and a widow who was widowed when she still had young kids at home - knew what every item on the grocery shelf was supposed to cost. Once, when she was recovering from an operation, I got to do her grocery shopping for her. She handed me her list - organized, of course, by aisle - her coupons, and $45, and told me that it should come out to $43.71. It did.

A frequent topic of phone conversation with my mother was always the price of iceberg lettuce, or grapes, or mayo, at the Price Chopper. Especially iceberg lettuce for some reason. I remember once her refusing to buy it because it had gone up a dime.

Me? I'm not so much concerned about what things cost at the grocery store.  Other than when bing cherries are going for $9.99 a pound in the dead of winter, I don't notice whether the price of anything is more than it was the week before. And I'm not that price sensitive, even if it is. I didn't grow up during the Depression, and I have a lot more money to fritter away than my mother ever did.

So I never noticed that, thanks to some nifty price fixing on the part of former Bumble Bee CEO Chris Lischewski, I was being gouged on tuna.

When it comes to tuna, I'd prefer to be a geisha girl, as Geisha was the brand I grew up on. I suspect my mother bought Geisha becomes it was cheaper. That or the only brand stocked at the neighborhood non-chain grocery store where our family shopped. 

In any case, as with several other products of my long ago and far away childhood - Scott toilet paper, Hellman's mayo - I remained brand loyal to Geisha. Until I couldn't find it anywhere, any more. So I switched to Bumble Bee, probably because it had the most space on the shelf devoted to it and/or because I never liked the Sorry, Charlie, ads for Starkist and/or because I always found the idea of Chicken of the Sea revolting, probably because my mind was always conflating chicken with the mermaid, and/or because while I know that sophisticated folks are supposed to prefer fancy tuna in oil, I'm a basic solid white in water kind of tuna gal.

So, unbeknownst to me, those prices I was paying were fixed
In December, Lischewski was found guilty by a San Francisco federal jury of conspiring with colleagues and other industry executives to manipulate canned tuna prices, capping aU.S. investigation that shook the packaged seafood industry and ultimately forced Bumble Bee into bankruptcy. (Source: Bloomberg Law)
A few weeks back, although his attorneys argued for 12 months home confinement - which, thanks to COVID, we all now know is not all that pleasant but is definitely doable -  Lichewski was slapped with a 40 month sentence and a $100K fine. Which at the going rate (3 for $5.00 for a 5 oz. can of solid white albacore in water) translates into 60,000 cans. In any case, Lichewski has finally run into something he hasn't been able to fix. 

Getting sent to prison for price fixing is rare. 
The best-known is the late A. Alfred Taubman, the shopping-mall magnate and onetime chairman of Sotheby’s Holdings Inc. He was convicted in 2001 and sentenced to a year and a day in prison for collaborating with rival auction house Christie’s International Plc to fix fees and cheat customers out of roughly $100 million. Taubman was released two months early.
Maybe the sentence for Taubman was relatively light for the financial magnitude of the cheat because he was scamming rich people.

As for Lichewski, the prosecution was looking for harder time (8-10 years) and more $$$ ($1M). So I guess you might say he's off the hook. A bit, at least.

As for other tuna producers - sorry, Charlie - Starkist and Chicken of the Sea were both involved. (Not, apparently, Geisha.) Not clear whether their execs will also do time, but Lichewski was considered the ringleader. (Didn't the ad used to tell us Bumble Bee tuna is best?)

Lichewski is appealing. And why not? Who in their right mind wants to spend time in the can?

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