In May 2023, the Supreme Court of Israel denied PAI Investment Ltd.'s petition for leave to appeal the Central District Court's decision to confirm a partial arbitral award issued by an arbitral tribunal in Florida in favor of Verso Israel LLC, represented by Naschitz Brandes Amir.
PAI, which is fully owned and controlled by singer Omer Adam, had entered into an agreement with Opticana to market a competing brand of eyewear, Cattleya. The arbitral tribunal found that PAI’s actions constituted a breach of its contractual obligations with Verso. By denying PAI’s petition for leave to appeal, the Supreme Court effectively affirmed the arbitral award and found that Adam’s actions (through PAI) did indeed constitute a breach.
The dispute began in 2018 when Verso and Omer Adam, through PAI, entered into a cooperation agreement (the “License Agreement”). Under the License Agreement, Adam served as the celebrity endorser of the Verso eyewear brand in Israel. In 2019, Verso and Opticana entered into an agreement for Opticana to serve as the exclusive distributor of VERSO eyewear in Israel (the “Marketing Agreement”).
In 2020, Opticana began marketing new eyewear models bearing the VERSO trademark without authorization from Verso, promoting them jointly with PAI and Adam, in violation of the terms of the Marketing Agreement and License Agreement. Verso filed a lawsuit in the Tel Aviv District Court, seeking a temporary injunction against Opticana to prohibit the marketing of eyewear bearing the VERSO trademark, and soon after initiated an arbitration proceeding in Florida in accordance with the terms of the License Agreement. The temporary injunction was issued in January 2021 and remains in force against Opticana. Opticana and PAI, on their part, filed counterclaims against Verso.
Despite the issuance of the temporary injunction by the District Court against Opticana, PAI continued its infringements. However, after the Supreme Court denied Opticana’s attempt to annul the temporary injunction, Opticana began marketing a new and competing brand called Cattleya, which had been promoted through PAI and Adam. As stated, these actions by PAI were determined in the arbitral award to be a breach of its contractual obligations, and it was explicitly determined that Adam’s actions to promote the Cattleya brand are a breach of PAI’s contractual obligations. So far, expenses totaling approximately NIS50,000 have been awarded against PAI. The main lawsuits pending before the Tel Aviv-Yafo District Court are still ongoing.
For more information, see the article on Mako.