Labour10/4/2026

Labor Court Dismisses Agentech’s Lawsuit Against Former Employee Who Founded a Competing Company

The Tel Aviv Regional Labor Court dismissed a lawsuit for approximately NIS 2 million filed by Agentech against its former employee, Yael Friedman-Gayer, and her company, Soltech Analytics. The employer failed to prove misappropriation of trade secrets or breach of duties of trust and good faith, and must pay the defendants NIS 50,000 in legal costs.

Key facts

•Court: Tel Aviv Regional Labor Court
•Plaintiff: Agentech
•Defendants: Yael Friedman-Gayer and Soltech Analytics
•Amount claimed: approximately NIS 2 million
•Legal costs: NIS 50,000
•Case number and date of judgment: not specified in the original source

From Dismissal to a New Business

Friedman-Gayer worked at Agentech as a support and sales specialist for scientific and analytical equipment from May 2016 until her dismissal in June 2020. She was the main technical contact with the Danish company FOSS, whose equipment Agentech distributed. About two months after her dismissal, the employee founded Soltech Analytics, which later became FOSS’s exclusive representative in Israel.

The Employer’s Claims

Agentech claimed that, while still employed, the employee helped bring about the termination of the relationship with FOSS, portrayed the employer negatively, offered lower rates and transferred confidential materials to a personal storage device. The company also noted that, during unpaid leave, Friedman-Gayer used her work computer to prepare a business plan, proposals and materials for the future company. The defendants argued that FOSS was the party that ended its relationship with Agentech and that it approached Soltech only after the employee’s dismissal.

Why the Lawsuit Was Dismissed

Judge Tomer Silora ruled that merely alleging the existence of a trade secret is insufficient: the employer must precisely define the confidential information and prove that it took reasonable measures to protect it. Agentech did not identify any specific document, software or process that met these requirements and did not prove that the copied files were used against it. The court also ruled that Friedman-Gayer’s professional knowledge and familiarity with FOSS representatives did not in themselves constitute a trade secret.

Ties With the Former Supplier

The court found no evidence that Friedman-Gayer intentionally harmed the relationship between the companies: the materials showed that FOSS had already been dissatisfied with Agentech’s work, in part because of customer complaints. In addition, FOSS was the party that approached Soltech after the employee’s departure, and her employment contract did not prohibit contacts with customers or suppliers of her former employer. The court also took into account the fact that the cooperation with FOSS generated only 2.5%–5% of Agentech’s revenue.

Outcome of the Proceedings

The lawsuit was dismissed in full. The court ordered Agentech to pay Friedman-Gayer and her company NIS 50,000 in legal costs. The case number and the date of the judgment were not specified in the original source.

What this means for you

A former employee’s establishment of a competing business or use of accumulated professional experience does not in itself prove misappropriation of a trade secret. The employer must identify specific confidential information, prove the measures taken to protect it and prove its improper use. However, copying work files may be considered improper conduct, even if, in this particular case, it did not result in liability.

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Case analysis based on court rulings