The default in case of filing a claim by a company is obligating it to deposit a guarantee for the expenses of the defendant

February 14, 2019

A company engaged in the design, production and marketing of emergency lighting products demanded an injunction relief preventing the marketing of a ceiling-mounted emergency lighting fixture that was misleading to a unique and innovative product of it, and thus infringed on its copyrights. The competitor demanded deposit of a guarantee for its expenses.

The Supreme Court held that the claimant is to deposit ILS 60,000 at the Court or a guarantee of two substantial shareholders in the amount of ILS 50,000 each. The Israeli Companies Law stipulates that a claimant that it is a limited liability company will be required, at the request of the defendant, to provide a guarantee for its expenses, unless it proves that it will be able to pay these expenses, or that the Court held that “the circumstances of the case do not justify” a deposit.  The burden of proving that the claimant will be able to pay the expenses is to the claimant and not to the defendant.