IP risk doesn't end with the company: Personal liability in intellectual property disputes

The case involved a long-running trademark licensing dispute concerning the well-known Beverly Hills Polo Club (BHPC) brand. The trademark owners alleged that products were manufactured, imported, and sold in breach of a trademark licence, while the defendants argued that their activities had been carried out with the knowledge and approval of representatives acting on behalf of the trademark owners.

The dispute generated extensive litigation and complex factual questions regarding trademark rights, licensing obligations, product approvals, reporting requirements, and commercial conduct. A significant part of the case focused on the parties’ course of dealing over many years, and on the role played by the trademark owners’ representatives in Israel.

As is often the case in IP disputes, the issues extended beyond the wording of the licence agreement itself. The court was required to examine how the parties conducted their business relationship in practice, what information was communicated between them, and how the licence arrangement functioned over time.

The court's analysis did not end with the company. It also addressed the personal role of the individuals behind the business and their knowledge of the relevant events.

A key question was what the company’s managers knew after the licence relationship had come to an end. According to the court, clear indications existed that the trademark owners objected to the continued use of their marks, and expected the activities to cease. Despite those indications, the importation, marketing, and sale of branded products continued.

On that basis, the court imposed personal liability on the individuals involved. The decision demonstrates that, in appropriate circumstances, courts may look beyond the corporate entity and examine whether managers were aware of conduct that infringed IP rights and nevertheless allowed it to continue.

Importantly, the ruling was not based on traditional “piercing the corporate veil” principles. The court did not disregard the company's separate legal personality. Instead, personal liability was imposed because the individuals themselves were found to have been aware of, and involved in the conduct that constituted trademark infringement. 

This reflects a well-established principle in IP law: managers and shareholders may face personal liability for their own infringing acts, even when those acts are carried out through a corporate vehicle.

For business leaders, this distinction matters. The risk does not arise simply from holding a management position. It arises where individuals are personally involved in decisions or activities that later give rise to IP claims.

This point is particularly relevant in licensing arrangements. Licensing agreements often regulate manufacturing, sourcing, distribution, reporting, and quality control. Compliance with these obligations is rarely handled by lawyers alone. It typically involves managers, commercial teams, procurement personnel, and senior decision-makers throughout the organisation.

Although the decision comes from Israel, the business message is universal. Intellectual property disputes often raise questions that go beyond legal rights and contractual obligations. They can also lead to scrutiny of management decisions and business conduct.

The lesson is straightforward. Intellectual property disputes do not always stay within the legal department. They can quickly become questions about what management knew, how it responded, and whether business activities continued despite clear legal warnings.

For executives and business owners, the message is equally clear. Intellectual property risks do not necessarily stop at the company level. Where managers continue activities despite clear indications that the legal basis for those activities may no longer exist, personal exposure may become part of the litigation landscape.

This judgment is a reminder that IP disputes are rarely just about trademarks, copyrights, or licensing terms. They are often about knowledge, decisions, and responsibility.

Lifestyle Equities C.V. and Lifestyle Licensing B.V. v. Don Gili Ltd., Shalva Gineli and Ilan Rosen, Tel Aviv District Court, Civil Case No. 13315-08-20 (2026).

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Robert Dorneanu is a Lawyer with Soroker Nordman Riba Advocates and Patent Attorneys. He's specialised in IP litigation, Copyright, Trademark, and Commercial Law.