Arbitrator finds “no basis” for Michael Eisenberg’s allegations against Ehud Barak and former 8200 chief
The NIS 10 million ($3.1 million) defamation suit over claims that the founders of cyber firm Paragon compromised Israel’s security has ended with a court-approved settlement. The arbitrator found that Eisenberg acted out of genuine concern, but concluded that his allegations were unsupported.
A NIS 10 million (approximately $3.1 million) defamation lawsuit filed by former Prime Minister Ehud Barak and former Unit 8200 commander Brig. Gen. (Res.) Ehud Schneorson against venture capitalist Michael Eisenberg, managing partner of the Aleph fund and considered an associate of Prime Minister Benjamin Netanyahu, has concluded following a mediation process that turned into arbitration.
At the center of the arbitrator’s decision is his conclusion that there was “no basis” for statements Eisenberg published about Barak and Schneorson, co-founders of offensive cyber company Paragon. Eisenberg had accused the two of compromising Israel’s national security in connection with the company’s 2024 sale to an American fund.
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Michael Eisenberg (left), Ehud Barak, and Ehud Schneorson.
(Photos: Amit Shaal Kobi Kuenkas)
At the same time, the arbitrator, attorney Meir Mizrahi, found that Eisenberg had published the statements out of genuine concern for the country’s security, rather than with the intention of harming the two men. As part of the resolution, Mizrahi recommended that Eisenberg make a “significant donation” to the Sheba Medical Center Rehabilitation Hospital, which treats IDF soldiers wounded in the war. The settlement was approved on Sunday by Jerusalem District Court Judge David Ziller, who gave it the force of a court judgment and ordered the case closed.
The dispute began in February 2025, when Eisenberg published a post on X (formerly Twitter) sharing allegations against Paragon and its founders following the company’s sale to an American fund in a deal reportedly valued at approximately $900 million. In his post, Eisenberg shared what the defamation lawsuit described as “false, defamatory statements” that had appeared the previous day on the platform, published by an anonymous account.
Among other things, the allegations claimed that Paragon, Barak and Schneorson had compromised Israel’s security by recruiting top engineers from Unit 8200, an act described as “stealing capabilities” and undermining the unit’s operations. They also alleged that the sale of Paragon involved the transfer of Israeli know-how without the necessary regulatory approvals or a formal oversight mechanism.
In their lawsuit, Barak and Schneorson argued that the accusations were false and particularly grave, as they portrayed two former senior security officials who had devoted their careers to defending Israel as having endangered its national security. They demanded that Eisenberg remove the post, publicly acknowledge in both Hebrew and English that the statements were false, issue an apology and refrain from making similar publications in the future. They also asked the court to order him to donate NIS 10 million, in lieu of monetary damages, to the HaGal Sheli (My Wave) nonprofit organization.
In his statement of defense, Eisenberg described the lawsuit as a “baseless SLAPP suit [strategic lawsuit against public participation], filed in a panic to stifle public discourse and criticism regarding the plaintiffs’ problematic conduct.” He argued that the plaintiffs, together with Paragon, were making commercial use of Israel’s offensive cyber capabilities, causing serious damage to the country’s reputation.
Eisenberg also argued that his position was shared by many others, including three senior intelligence figures who had warned in a July 2024 letter to the Ministry of Defense that the sale of Paragon to foreign interests posed significant risks to national security.
Barak and Schneorson were represented by attorneys Yoram Raved, Shmuel Galinka and Inbar Herman of Shibolet & Co. Eisenberg was represented by attorneys Assaf Benmelech and Naama Horn of Ben Zur Korb. The case was initially referred to mediation, during which the parties authorized the mediator, attorney Mizrahi, to act as arbitrator if the dispute could not otherwise be resolved. After a series of joint and separate meetings with the parties, Mizrahi issued a decision setting out his conclusions.
First, Mizrahi addressed concerns surrounding the sale of Paragon to foreign owners, particularly the possibility that cyber technologies and defense-related know-how developed in Israel could be transferred abroad. He wrote that “Paragon was sold to its current shareholders without any statutory requirement to obtain approval from the Ministry of Defense.” Nevertheless, he noted that the transaction had been reported in advance to the relevant authorities at the ministry. Following subsequent discussions, a detailed arrangement was formulated “with the consent of the Ministry of Defense and the relevant officials within the defense establishment” to protect the defense-related know-how developed in Israel and prevent its leakage.
Mizrahi also noted that Barak and Schneorson’s legal counsel had clarified during the proceedings that their clients were entirely unaware of the letter from defense establishment officials cited by Eisenberg. According to the arbitrator, the arrangement eventually reached addressed the concerns raised in that letter.
Mizrahi wrote that he was convinced Eisenberg had published the allegations “out of genuine concern.” Eisenberg, for his part, clarified that he had not intended to harm Barak and Schneorson or to establish definitive factual findings about them or Paragon, but rather “to raise questions and concerns that, in his view, warranted examination.”
“Now that these matters have been clarified, I conclude that there was no basis for the statements that were published,” Mizrahi wrote. He added that Eisenberg would not have published the statements, or repeated them, had he known about the clarifications presented during the proceedings.
The arbitrator also noted that Eisenberg did not question the significant contributions Barak and Schneorson had made to Israel’s security. He urged the parties to put the dispute behind them while recognizing the importance of free and respectful public discourse. “The parties ought to refrain from escalating the dispute and instead move past it,” he wrote.
As part of the resolution, Mizrahi recommended that Eisenberg make a “significant donation” to the Sheba Medical Center Rehabilitation Hospital, which works to rehabilitate IDF soldiers wounded in the war.
The decision does not specify the amount of the donation, nor does it explicitly order Eisenberg to issue an apology in the wording originally requested by Barak and Schneorson. However, in a letter attached to the decision and sent to the parties’ legal representatives, Mizrahi sought to ensure that the donation would be made. “Upon receipt of confirmation regarding the donation, I will submit the decision to the court,” he wrote. He also requested that the decision be published on the social media platforms where the original statements had appeared.
