TRANSACTIONS

A Noteworthy Precedent in Derivative Actions | February 2019

A Noteworthy Precedent in Derivative Actions | February 2019

Adv. David Fohrer and Adv. Shai Erez of our litigation department represented Aura Investments Ltd. and its directors in a matter in front of the Supreme Court, which rejected an appeal of the dismissal of a motion for preliminary disclosure prior to permitting a derivative action to proceed against our clients.

Supreme Court Judges Amit, Solberg and Mintz ruled that the good faith requirement under Section 198 of the Companies Act should be viewed as an independent condition, and that in case of a conflict of interest involving a party who seeks to be appointed as a derivative plaintiff, such party’s motion should be dismissed based on lack of good faith regardless any further argument with respect to the cause of action itself.

See link to the judgment 

2019

David Fohrer

Phone +972-3-6074460

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Shai Erez

Phone +972-3-6074580

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