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Recently, a four month proxy fight over control of an Israeli incorporated NASDAQ traded company was settled, following a series of proceedings held before the Tel Aviv District Court. At a crucial juncture, the Tel Aviv Court was asked to issue a temporary injunction over a transaction initiated by the board, which included a highly dilutive (24.9%) issuance of shares.
The Israeli Supreme Court has set a precedent by ruling that the Business Judgment Rule should also be applied to a company’s board of directors when it is deciding whether or not to file a derivative suit.
A significant precedent was handed down recently by the Israeli Supreme Court, whereby a company’s separate and independent standing must be recognized, even after a motion for a derivative suit has been approved.