Former Prime Minister Ehud Barak and ex-Unit 8200 commander Ehud Schneorson, two of the co-founders of the offensive cyber firm Paragon, are suing venture capitalist Michael Eisenberg for defamation and have refused a proposed mediation.
The suit, filed after a series of social media posts by Eisenberg, is now moving forward in court, according to a report on Tuesday.
Barak and Schneorson allege that Eisenberg, a managing partner at Aleph VC, was motivated by a conflict of interest tied to NSO Group, a competitor of Paragon. In court documents, they claim Eisenberg defamed them by amplifying accusations originally posted on X (formerly Twitter) by an anonymous source named “Alon.”
In a February post, Eisenberg quoted “Alon” as accusing Paragon of harming Israel’s national security and exporting Israeli intelligence without Defense Ministry approval. “Alon” also alleged that Paragon’s core surveillance technology was based on stolen knowledge from Unit 8200 and that the company recruited key personnel from the unit with high salaries, leading to the collapse of one of its departments. He further claimed the exposure of Paragon’s tools by WhatsApp put Israeli intelligence capabilities at risk and accused the company of securing Defense Ministry contracts without tenders.
While Alon’s identity remains unknown, the account is reportedly linked to a coordinated bot campaign aimed at discrediting Paragon. Despite the anonymity, Eisenberg translated the thread into English using Elon Musk’s chatbot Grok and encouraged tech journalists to investigate the claims. He added his own comments, calling Paragon a “gone rogue” company and suggesting its sale to a U.S. firm — allegedly facilitated by Barak and Schneorson’s ties to U.S. Secretary of State Antony Blinken — was suspiciously timed.
Following the post, Barak and Schneorson demanded a public apology and NIS 10 million in damages to be donated to charity. Their attorneys claimed the accusations were “blatantly false” and intended to smear their reputations.
Eisenberg’s April response argued he was simply expressing concern for Israel’s security and encouraging journalistic scrutiny. He denied making definitive factual claims and said his views were shared by three senior intelligence officials who had raised similar concerns with the Defense Ministry. He also argued the lawsuit was an attempt to silence public debate.
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Barak and Schneorson’s latest filing counters that Eisenberg’s motivations were not civic but personal and financial. They point to his investments in multiple cybersecurity firms employing Unit 8200 veterans, particularly Dream Security, co-founded by Shalev Hulio, a close associate of Eisenberg and the former CEO of NSO. The plaintiffs suggest Eisenberg’s attacks on Paragon may stem from a business rivalry and resentment over its success compared to Hulio’s.
Neither side provided a comment on the case.