The Applicants added that the Association did not really decide to implement the conclusions of the Claims Committee's report, and that it does not do so in practice. This is their approach from the Association's management meeting on January 8, 2020. The transcript of the meeting shows that the Association has no intention of improving the damage by deducting funds from the Premier League and the National League. No operative measures have been determined, and no amounts have been determined for collection. Adv. Kfir Yadgar, The Association's counsel (hereinafter: "Adv. Yadgar") even presented the sum of NIS 5 million as the maximum amount, and its legal counsel argued that if teams in liquidation pay any sums of the "hypocrite" funds, they will be deducted from the sum of NIS 5 million. From that meeting it also emerges that in order to collect the sums that will remain as damage to the Association, Groups that have not signed a commitment to pay the "unpaved" funds will also be obligated to pay, contrary to the opinion of the majority in the Claims Committee. According to the applicants, the association is acting to delay the proceeding with the aim of "dissolving" it, instead of implementing the recommendations of the claims committee.
- According to the applicants, the committee's decisions must be subject to the standard of judicial review of full fairness, and the burden of proving compliance is on the Association. In this context, the Applicants raised a number of reasons that they claim negate the applicability of the business judgment rule in the present case. First, the Claims Committee was established at the end of a full judicial proceeding; Second, the association does not act according to the recommendations of the committee's majority opinion; Third, the decision not to file a lawsuit against respondents 2-4 entails an inherent conflict of interest, since we are not dealing with a "third party" but rather with former officers of the Association; Fourth, the decision of the Association's management not to file a lawsuit was not made in an informed manner, since the management did not hold any substantive discussion of the committee's report and its conclusions, and in particular not on the gaps between the majority opinion and the minority opinion; Fifth:, in making the decision to adopt the conclusions of the Claims Committee, members of the management who were in a situation of conflict of interest (being exposed to a third-party notice that may be filed against them) participated – which impairs the decision-making process even in the absence of an infected majority.
- The Applicants detailed the causes of action alleged against the Respondents. They noted that respondents 2-4 are jointly and severally responsible for the entire sum that was illegally taken out of the Association's coffers. It was also clarified that even the majority of the Claims Committee reached the conclusion that respondents 2-4 were responsible for the prohibited transfers and the creation of the deficit in the Association's coffers, and that they were aware of its formation.
With regard to respondent No. 2, it was argued that he bears primary responsibility for the course of events at the center of the application. The prohibited transfers were made in accordance with his decisions and in accordance with his wishes, and he is responsible for the misleading presentation of the deficit in the financial statements. Respondent No. 2 acted with awareness of the wrongfulness of his actions, in an attempt to prevent the disclosure of the facts, and while deriving personal benefit from the transfers. In this conduct, he violated his duty of fiduciary duty and his duty of care as an officer of the Association. and even committed a tort of fraud against the association within the meaning of section 56 of the Torts Ordinance [New Version].