Civil Case (Center) 14545-07-23 Philip Roitman v. Cortica Ltd.

Judgment

An action filed by the plaintiff, Mr. Philip Roitman (hereinafter: "the plaintiff") to enforce a locating agreement signed between him and defendant 1, Cortica in a tax appeal (hereinafter: "Cortica"), in which Cortica, together with companies affiliated with it, undertook to pay the plaintiff a commission for a financial investment made by Singapore sovereign fund TEMASEK (hereinafter: "Temasek") in Cortica, or any other company related to it.

Background to the Claim

1. The plaintiff is a businessman for formulating business strategies, raising investments, development and sales in the field of technology.
2. Cortica is a large corporate conglomerate, which includes a number of companies, engaged in the field of artificial intelligence, which has developed visual artificial intelligence technology in self-learning, including in the field of vehicles.
3. Defendant 2, Autobrians Technologies in a Tax Appeal (hereinafter: "Autobrains") is a private company established in 2018, which is part of the Cortica Group.
4. Defendant 3, Mr. Yigal Reichelgauz (hereinafter: "Yigal") is the founder, controller, director, issuer and receiver, both in Cortica and in Autobrians.
5. The relationship between the plaintiff and Cortica began in 2014 when the plaintiff was asked by Cortica's counsel to examine the possibility that Cortica would assist the plaintiff in raising capital.
6. Following the request, the plaintiff initiated a preliminary inquiry among strategic investors with whom he was in contact in order to examine investment options in Cortica. In this framework, the plaintiff thought of getting to know Temasek, a Singaporean investment company, and Cortica.
7. Cortica's counsel met between the plaintiff and Yigal, who was Cortica's CEO at the time. In the framework of the meeting that took place on February 2, 2014, the plaintiff stated to Yigal that he had succeeded in generating early interest in a significant strategic investor to examine the possibility of investing in Cortica.  Yigal responded positively to the plaintiff's offer to try and coordinate a meeting between him and a senior manager at the same strategic investor (Tamasek) who was in Israel at the time, Mr. Ravi Lambah, but in the end, that meeting was not helpful.  However, the plaintiff continued his attempts to arouse interest in Tamasek in relation to Cortica.
8. In order to formalize the business relationship between the plaintiff and Cortica, on May 3, 2014, a locating agreement was signed between the plaintiff and Cortica, entitled: "Non Exclusive Finder's Fee Agreement" (hereinafter: the "Agreement"), which was drafted by Cortica's counsel (Exhibit 1 of the plaintiff's exhibits). As part of the agreement, Cortica, together with "affiliated entities", undertook to pay the plaintiff a commission for a financial investment made by Temasek in Cortica and/or its related corporations, under the terms as detailed in the agreement.
9. After the agreement was concluded, the plaintiff worked to coordinate a meeting with Mr. Mukul Chawla , who served as senior manager and co-head of the technology, media and communications department at Tamasek. On May 14, 2014, the plaintiff made an acquaintance between Cortica, through Yigal, and Mukul Chawla.
10. Subsequently, the plaintiff coordinated a meeting between Yigal and Mukul Chawla, which took place on June 9, 2014, at Temasek's offices in New York. At this meeting, Yigal presented the technology developed by Cortica.
11. The Ottoman Settlement [Old Version] 1916On September 1, 2014, the plaintiff held a meeting (remotely) between Cortica and another senior member of Tamasek based in Singapore - Mr. Jonathan Lau.
12. 12-34-56-78 Chekhov v. State of Israel, P.D. 51 (2)On September 2, 2014, Mr. Lau announced that in light of Cortica's presence in the early stages, Temasek was not interested, at this time, in investing in it, but noted that: Temasek would like to continue contacts with Cortica and meet with it down the road, after 6-12 months have passed (Exhibit 14 to the plaintiff's exhibits).
13. Nine months later, on June 28, 2015, the plaintiff renewed contact with Yigal, but Yigal asked him to refrain from talking to Temasek about Cortica.
14. A few more months later, on February 9, 2016, the plaintiff again tried to contact Yigal in order to coordinate a meeting with Temasek, but Yigal replied that Cortica had completed an investment round and was not looking for investment opportunities at that time.
15. In 2018, Autobrines was founded. As its general manager and as a director, Yigal was appointed, who at the time also served as CEO and director of Cortica. As CFO and Additional Officer of Autobrians, Mr. Asher Avital (hereinafter: "Asher"), who served at the time as Chief Financial Officer of Cortica, was appointed.
16. On November 1, 2021, Autobrain announced a capital raising of $101 million (which was completed on March 10, 2022 in the amount of $120 million), with the investor leading the investment round being Temasek. Attached to the statement of claim was an article dated November 1, 2021 in the newspaper "CTECH", in which the capital raising was announced, a fact that is not in dispute.
17. On February 5, 2023, after the plaintiff learned of the aforementioned transaction, he contacted Yigal with a request to fulfill his obligations under the agreement, and to pay him the commission in light of Temasek's investment in Autobrians.
18. Yigal rejected the plaintiff's request and claimed that: the agreement was limited in effect to one year and expired; The agreement was between the plaintiff and Cortica and not between the plaintiff and Autobrians, and that the plaintiff was not involved in the transaction. Letters rejecting the plaintiff's claims were even sent by attorneys for Cortica and Autobraines in response to letters of demand sent by attorneys for the plaintiff.
19. In these circumstances, the claim before me was filed, in which the plaintiff petitioned for enforcement of the agreement and payment of the commission by virtue of it (which was determined in a gradual manner depending on the amount of the investment), and alternatively, the defendants were required to pay compensation for the breach of the agreement and its performance in bad faith; Alternatively, the defendants were obligated to pay the plaintiff a proper salary in the sum of ILS 2.6 million.
20. The defendants did not deny the existence of the agreement between the plaintiff and Cortica, but denied the plaintiff's entitlement to the remedies claimed.

The parties' arguments