Bank Leumi CEO Praises Court Ruling Against Class Action Lawsuits

Hanan Friedman, CEO of Bank Leumi, has expressed strong support for a recent ruling by the Central District Court in Lod, which dismissed class action lawsuits against Shufersal and Aloniel, the operator of McDonald's in Israel. The lawsuits alleged violations of the "Spam Law" related to the digital invoices sent to customers. Friedman called for significant legal costs to be imposed on those who file frivolous lawsuits and abuse the class action mechanism.

In a post on X, Friedman stated, "An excellent decision by the court. Class actions are an important tool for protecting the public and rectifying wrongs, and when justified, they should be encouraged. But some have turned this tool into a business of frivolous lawsuits. It's time to impose high costs on those who misuse the process, while ensuring that those who are truly harmed can sue and receive compensation."

The ruling, delivered by Judge Carmit Ben Eliezer, addressed whether including marketing content in digital invoices, after customers agreed to receive them digitally, constitutes a violation of the Communications Law, commonly known as the Spam Law. In the Shufersal case, the lawsuit stemmed from purchases at the Be Pharm chain, with the plaintiff claiming that marketing content was added to a digital invoice without separate consent for advertisements.

The court determined that the primary purpose of the invoice was to provide a service, i.e., delivering the requested invoice, and that the marketing content was secondary and limited. Judge Ben Eliezer distinguished between an advertisement-focused message and one primarily intended to serve the customer. The court also noted that the digital invoice's marketing information was identical to that found in a regular paper invoice. The transition to digital invoices was recognized as a desirable policy, partly due to environmental benefits.

The court found that even if there was a minor non-compliance with the law, it did not necessarily justify a class action. It was deemed a marginal violation causing no significant harm or inconvenience to customers, questioning the necessity of a class action. The ruling also highlighted that the plaintiff had been involved in 11 similar previous applications, most of which ended in compensated withdrawals. In this case, the proceedings went to a judicial decision, resulting in the dismissal of the claim against Shufersal and a NIS 30,000 cost order. The claim against Aloniel was also dismissed, with another NIS 30,000 in costs awarded, totaling NIS 60,000.

Friedman clarified that his stance is not against class actions in general, but rather emphasizes the need to ensure they serve their intended purpose while imposing financial consequences on those who misuse them.