Half Free CEO Accuses Founder's Heirs of Frivolous Lawsuit

Motty Kuperly, the sole CEO of the retail chain Half Free and business partner of its late founder Zaki Shalom, is demanding a Tel Aviv court dismiss a lawsuit filed by Shalom's widow, Mazal Shalom Bag, and daughter, Orit Shalom. Kuperly alleges the lawsuit is a "frivolous suit that is merely a tactical tool to achieve improper goals," and claims it involves the unauthorized disclosure of confidential company information. The request was filed by Kuperly and seven family members three and a half months after the Shalom family members initiated their legal action.

In their original suit, Mazal Shalom Bag and Orit Shalom sought to dissolve the partnership in the joint real estate investment company, Kuperly and Shalom Investments. This company, an affiliate of Half Free, was established to invest surplus funds from the food chain into various real estate ventures. They asked the court to compel Kuperly, who holds 66% of the company's shares, to buy out their minority stake.

Kuperly's motion comes a week after it was reported that he had fired Mazal Shalom Bag from her position as deputy CEO of trade at Half Free. This followed her earlier dismissal as co-CEO three months prior, after which Kuperly assumed sole leadership. Kuperly argues that the plaintiffs are attempting to disguise a financial claim by splitting off the remedies section, which he contends includes explicit monetary demands, such as forcing the buyout of their shares based on the company's fair value.

He further asserts that the plaintiffs seek to exclude or reflect alleged damages, which he denies, from the share valuation. Kuperly claims that if the court accepts their "baseless lawsuit," it would necessitate ruling on these disputed damages within the current proceedings. He also points to additional "disguised financial remedies," such as regulating credit for Kuperly and Shalom Investments, as evidence that the suit is primarily financial, not declaratory, and should therefore require payment of legal fees.

The dispute escalated following Zaki Shalom's death last August. According to Mazal Shalom Bag, the trust and balance between Kuperly and her late husband dissolved after his passing. She claims Kuperly evaded her requests for information on real estate dealings. She also stated that since July, she had warned in writing about corporate governance failures, lack of transparency, irregular debts, and misuse of group resources, demanding oversight mechanisms.

Mazal Shalom Bag contends that while Half Free has positive cash flow from operations, it is burdened by financing costs of approximately 1.5 billion shekels. This debt, she claims, stems largely from supporting Kuperly and Shalom Investments' real estate deals through guarantees and ongoing financing. Consequently, Half Free has been moved to special credit departments at banks, with its debt classified as risky, incurring annual financing costs of about 120 million shekels. The conflict has also reportedly turned personal, with Mazal Shalom Bag alleging Kuperly threw a drink bottle at her face during a meeting last January, causing an eye injury, prior to her dismissal.