However, a perusal of this appendix shows that the plaintiff did indeed market Paragon's products, inter alia through agents who purchased goods from him, but not on the existence of a right to exclusivity.
- The plaintiff also sought to base his claim regarding the granting of exclusivity for the marketing and sale of Paragon products in Israel on the testimony of Mr. Nahmias.
In practice, it emerged from Mr. Nahmias's testimony that this "exclusivity" was the result of the situation on the ground, actual conduct and especially Paragon's lack of interest in dealing with the local market, but did not stem from the existence of any contractual obligation that was given to it.
Among other things, Mr. Nahmias testified as follows:
"In about 2002, I met with Pini in Netanya about goods that I identified that he was producing in other factories and I told him that I was willing to buy in quantities and in cash, and he said that he was not selling in Israel to anyone because he was burned. And I convinced him and we started an activity. We worked until about 2011 in full exclusivity. I sold to all the big ones... I sold Paragon's merchandise, he didn't care about the country, he mainly deals with exporting to the sand. And everyone who went to the factory sent him to Nahmias, everyone understood that Paragon's merchandise could be bought from Nahmias. The maintenance of this thing called exclusivity, franchise, only I can buy it, I don't know what the exact definition of it is..." (p. 56, paras. 24-32 of the minutes of the hearing of December 7, 2022); And later: "The conduct was that only I was buying..." (p. 57, para. 11 of the minutes of the hearing) (Emphasis not in the original - H.S.).
- In addition, the testimony of Mr. Zion Alaluf was brought, who testified that he himself imports products from abroad and markets them, and at the same time he markets Paragon products that he purchased from Mr. Nahmias.
Mr. Allalouf further testified that he purchased the Paragon products from Mr. Nahmias and not from Paragon directly, since no one could contact Paragon, except for Nahmias, who was their exclusive marketer, and that he subsequently moved to work with the plaintiff, since this was the only way to purchase goods from Paragon (see pp. 55, paras. 22-32 of the minutes of the hearing of December 7, 2022).
- On the other hand, Mr. Alfasi testified that they were never promised or given a franchise or exclusivity to sell Paragon's products, and that he purchased Paragon's products through Nahmias, only in light of the relationship of trust and family ties that existed between them (see p. 94, paras. 23-31 and p. 106, paras. 25-29 of the minutes of the hearing of February 21, 2024).
- Shlomo Haberman, CEO of Paragon Industries at the relevant time and today, and Mr. Pini Dershewitz, a shareholder in Paragon, also testified that Paragon never entered into a franchise or exclusivity agreement to market its products, neither with the plaintiff or the defendants nor with anyone else, that this is contrary to the company's policy and that Paragon had prior to the commencement of work with the plaintiff, during it and even today. Customers in Israel, including in the territories of Judea and Samaria, who purchase its products (paragraphs 5 and 6 of Mr. Haberman's affidavit and paragraphs 10-12 of Mr. Dershewitz's affidavit, as well as see the testimony of Mr. Haberman at p. 91, paras. 3-11 and 16-17 of the minutes of the hearing dated February 21, 2024).
- Dershowitz further testified that anyone who wanted to buy goods directly from Paragon had the option to do so if he was certified as an honest person paying his bills. However, he further testified that in practice, 95% of the goods sold by Paragon are directed for export and that the local market is very small. Mr. Dershewitz did not recall the names of other marketers other than Ital Plast, and a customer named Reminder of Petah Tikva, who he claimed purchased goods from Paragon on a large scale (see pp. 48, 16-17, 25-36, pp. 49, 1-13, and 50 s. 4-9 of the minutes of the hearing of April 19, 2023).
- CPA Keinan also testified that Paragon's numbers showed that during the period relevant to the lawsuit it sold products to other customers, besides the plaintiff, but he did not remember to specify names (see paragraph 5 of his affidavit and his testimony at p. 70, paras. 18-20 of the minutes of the hearing of April 19, 2023).
- The plaintiff confirmed in his testimony that during the period relevant to the lawsuit, Paragon also sold products to other third parties, including Ital Plast and the Shufersal chain (see paragraph 4 of his affidavit and testimony at pp. 30, paras. 25-29 of the minutes of the hearing).
- In this regard, and despite what is stated in the plaintiff's affidavit that in the case of the Ital Plast company in question was a limited period of authorization, which can be revoked at any time, in small amounts and in a limited number of products, in the course of his investigation, it became clear that Eital Plast sold products to the Home Center chain, in the amount of tens of thousands of shekels per month (see pp. 31, paras. 2-7 of the minutes of the hearing of December 5, 2022). Needless to say, no evidence was brought that the plaintiff's approval was requested for the sale of the products to Ital Plast or that the approval was given for a limited period or beyond the letter of the law (ibid., paras. 8-13 of the minutes of the hearing of December 5, 2022).
- Haberman, CEO of Paragon Industries, and Ms. Miriam Attias, who works for Paragon, testified that Paragon had and still has many customers in Israel, including Shufersal, Ital Plast, IPS, Omer, Methiplast and Yadmi (see the testimony of Mr. Haberman at pp. 91 at 18-20 and 93 at 2-11 of the minutes of the hearing of February 21, 2024 and the testimony of Ms. Atias at 80 s. 1-11 and 8 s. 8-31 of the minutes of the hearing).
- The plaintiff sought to be supported by a statement of defense filed by Paragon in another proceeding that took place between the parties, in civil case 12655-05-15, in which Paragon stated that at a certain time the plaintiff served as its exclusive marketer in Israel, as well as in the testimony of Mr. Dershevitz in the same proceeding, according to which Paragon also sold products to Shufersal and others "with the approval of Yigal Yadin".
According to the plaintiff, the very fact that he was approached for approval for the sale of the products indicates the acquisition of that exclusivity (see p. 2, paragraph 4 of Appendix C1, Exhibit E to the plaintiff's exhibits file and his testimony at pp. 30, paras. 25-36 of the minutes of the hearing of December 5, 2022).
- Dershewitz testified in relation to what was stated in the statement of defense, that Paragon's attorney worded it in this way innocently, and in practice the intention was that he was a primary marketer and not an exclusive one. In addition, he further noted that even if in practice Paragon chose to market the goods through one dealer and not through several resellers, this does not indicate that that dealer was given exclusivity and that Paragon was not entitled to market its goods through other dealers as well (see para. 24 of his affidavit and testimony at pp. 53, paras. 11-27 and p. 54, paras. 1-6 of the minutes of the hearing of April 19, 2023).
With regard to his testimony in the additional proceeding, according to which goods were also sold to others "with the plaintiff's approval", he clarified that he would inform the plaintiff when he sold goods to others, that even today he updates when he sells goods to Maxstock or Zollstock, but this does not indicate exclusivity (see s. 24 of his affidavit and his testimony at p. 58 s. 12-29 and at p. 60 s. 10-12 of the minutes of the hearing of April 19, 2023).
- An examination of Mr. Dershowitz's testimony in the framework of the additional proceeding shows that the issue of exclusivity was not the one that was discussed in that proceeding, and that in any event, Mr. Dershowitz did not seek to testify to its existence, but rather the opposite: "... not only to them we sold, but also to Shufersal and others with his approval" (see Appendix E to the plaintiff's affidavit, at pp. 5, paras. 28-29 of the minutes of the hearing of January 3, 2016).
- In parentheses, it should be noted that no evidence was presented indicating that the plaintiff was asked to obtain the plaintiff's approval for the sale of goods to one customer or another, and the plaintiff testified that the authorization was given in a criminal appeal (see p. 31, paras. 8-13 of the minutes of the hearing of December 5, 2022).
Moreover, an application for the plaintiff's "approval", although it can indicate a commercial relationship in which the plaintiff was given a certain preference or recognition, does not necessarily indicate the absence of a right on the part of Paragon to change its conduct.
- With regard to Mr. Alalouf's testimony, Mr. Dershewitz clarified that he did not remember the phone call that Mr. Alalouf testified, but as a rule, Paragon is known in Israel to a small number of customers, since it is a market that does not interest it, and therefore when a small customer approaches it, he refers it to one of the marketers, and it is possible that this is also what happened with Mr. Alalouf, but this does not indicate exclusivity (see p. 58, 30-p. 59, 24 of the minutes of the hearing of April 19, 2023).
- Regarding Shufersal, Mr. Dershowitz clarified that at the beginning of his activity with them, in 2013, he thought that this would also be carried out through the plaintiff, since at that time Paragon preferred to sell to as few customers as possible in Israel and worked with individuals, and therefore he brought the plaintiff to a meeting with them. However, since the engagement with Shufersal required a different work method and operation than usual, as well as the signing of a complex contract, it was ultimately agreed that Shufersal's engagement would be done directly with Paragon. The plaintiff's approval was not required, he was not entitled to a bonus or commission in respect of this engagement, and to the extent that he was given any discount or bonus, it was given out of kindness and in an attempt to assist him in settling his debts, and not due to any obligation. In addition, he testified that the intention was to give the plaintiff a credit of about a quarter of a million shekels and that it was given on a one-time basis, and not only with respect to sales to Shufersal but also with respect to other customers (see p. 59 s. 25-p. 60 s. 9, s. 13-15 and p. 60 s. 16 - p. 61 s. 7 of the minutes of the hearing dated April 19, 2023).
- Haberman also testified that there was no connection between the sales of Paragon's products to Shufersal or to other third parties and the plaintiff, that the plaintiff did not receive royalties in respect of this and that this was the policy of Paragon (see paragraph 8 of his affidavit and testimony at pp. 92, paras. 1-5 and 9-10 of the minutes of the hearing of February 21, 2024). With regard to the specific invoice from which it appears that a discount was given to the plaintiff, at the rate of 5% of the sales to Shufersal, he clarified that it is possible that something special was discussed that he did not know about (see p. 92, paras. 19-23 of the minutes of the hearing).
- Interim summary on the issue of exclusivity - the overall factual picture to which I was exposed was that in which the plaintiff and the partnership never reached explicit contractual agreements, whether written or oral, according to which the plaintiff was given exclusivity to sell Paragon's products.
Instead, and as stated above, Paragon conditioned, from the outset, on the very granting of its consent to the marketing and sale of its products by the Partnership on the repayment of Mr. Nahmias' debt, and de facto - this debt was repaid.