Israeli Court Dismisses Class Action Against Trias Over Valuation Dispute

The Tel Aviv District Court has dismissed a class-action lawsuit filed three years ago against Trias P2P, formerly Luzon Real Estate and Finance, controlled by Amos Luzon. The suit also named company directors and valuation firm C. Value, which assessed Trias's business worth. The lawsuit was brought by shareholders who alleged they suffered damages due to a 2022 merger with Trias P2P, based on a flawed and negligent valuation. They claimed the company withheld crucial information from shareholders that could have influenced their votes on the merger.

The plaintiffs, Walter Tip and Israel Keller Engineering Services, sought damages in the tens of millions of shekels. The merger agreement between Luzon Real Estate and Trias was finalized in 2022, with Trias valued at approximately 320 million shekels. The deal was contingent on Trias being valued at at least 300 million shekels and Luzon selling its existing real estate operations for 70 million shekels.

Judge Michal Rosen-Ozer ruled that the alleged damages were to the company itself, not directly to the shareholders, and therefore the proper legal avenue would be a derivative lawsuit, not a class action. The court stated that the claimed damages stemmed from the company's own losses, calculated based on its valuation. The shareholders argued they had a personal claim due to misleading information in the company's reports, specifically regarding the valuation data. However, the court found no basis for a personal claim as it was not alleged that the plaintiffs bought or sold shares based on the misleading information.

Despite dismissing the suit, the court did not award costs to the defendants, as they had not yet filed responses. The plaintiffs were represented by attorney Lior Lahav, while various defendants were represented by legal teams from prominent Israeli law firms.