- July 24, 2026
- 10:59 pm
- Israel
The Supreme Court of Israel has concluded a long-standing commercial dispute between the structures of the alcohol holding Global Spirits and the Israeli distributor A.G.T.D., which since 2005 has been promoting Khortytsa and Morosha vodka. The court upheld the compensation of $500,000, although initially, the Israeli company demanded four times more. During the proceedings, the dispute went far beyond the monetary issue: the Israeli rights to the Khortytsa trademark were transferred to the former distributor, who announced the launch of local production.
On July 24, 2026, Israeli media reported the final conclusion of one of the longest commercial conflicts in the local alcohol market. The Supreme Court of Israel rejected the mutual appeals of the companies GSH Trademarks Limited and Global Spirit Europe, associated with the Global Spirits holding, as well as the Israeli distributor A.G.T.D. and left unchanged the decision of the Haifa District Court.
As a result, the structures of Global Spirits must pay the former Israeli partner $500,000. Meanwhile, A.G.T.D. failed to achieve the full contractual compensation of two million dollars, and the manufacturers, for their part, could not prove that they were not obliged to pay the distributor at all.
The appeal case was considered under the number ע”א 3721/24. The panel included the President of the Supreme Court of Israel Yitzhak Amit, as well as judges Dafna Barak-Erez and Khaled Kabub. The judges decided that the Haifa District Court thoroughly examined the documents, witness testimonies, and correspondence between the parties, so there are no grounds for revising the established circumstances.
Cooperation that lasted almost 14 years
The relationship between A.G.T.D. and Global Spirits began back in 2005, when the Israeli company received exclusive rights to import, market, and distribute the holding’s alcoholic products in Israel, as well as in the Palestinian Authority territory.
Israeli media named Yevgeny and Alexander Torgovetsky as the owners of A.G.T.D. The company was engaged in the import and promotion of several dozen alcohol brands, and cooperation with Global Spirits became one of the most prolonged directions of its activity.
Over the years, Khortytsa vodka has taken a prominent place in the Israeli market. According to data presented by A.G.T.D. with reference to the Storenext rating, in 2019 the brand was in fourth place in sales among vodka brands in Israel, ahead of Stolichnaya, Grey Goose, Smirnoff, and Van Gogh. This information came from representatives of the Israeli distributor, so the court did not consider it a neutral assessment of the entire market, but it shows that by the time the relationship ended, Khortytsa was already well known to the Israeli consumer.
A new agreement was signed by the parties on December 21, 2017. The contract was designed for 60 months and, under normal cooperation development, was supposed to be in effect until December 21, 2022. The document provided for the preservation of A.G.T.D.’s exclusive rights, regular distribution checks, and the possibility of early termination of the agreement in case of significant breach of obligations.
At the same time, the parties recorded a large penalty: the company that unlawfully and unilaterally terminates the contract was to pay the partner two million dollars. It was this clause that later became the basis of A.G.T.D.’s lawsuit.
Why the relationship deteriorated at the end of 2018
A serious deterioration in relations between the companies occurred at the end of 2018. The court materials featured an episode related to the request of Global Spirits owner Yevgeny Chernyak to temporarily employ his son in the Israeli company so that he could learn the specifics of the alcohol business.
A.G.T.D. refused to fulfill the request, explaining its decision by legal obstacles related to work permits and employment in Israel. According to the materials considered by the Haifa District Court, Chernyak negatively perceived the refusal and wrote in a general WhatsApp group about the intention to prepare documents for terminating the cooperation.
A few days later, Global Spirits offered the Israeli partner to voluntarily terminate the contract. In official correspondence, the issue of the son’s employment was no longer mentioned: the manufacturer cited shortcomings in A.G.T.D.’s work, including weak product promotion and insufficient brand presence in retail outlets.
The Israeli company refused to terminate the contract and stated that it intended to continue working until December 2022. After further exchanges of letters, Global Spirits reported that the agreement would remain in force for the time being, and the previous termination offer should be considered withdrawn.
Later, A.G.T.D. claimed that the refusal to employ Chernyak’s son was the real reason for the conflict, and the claims about product distribution were used only for the legal formalization of a pre-made decision. The court did not recognize this version as the only proven explanation for the breakup, but considered the episode an important part of the overall chronology of the deterioration of relations.
Claims of Global Spirits against the Israeli partner
Global Spirits claimed that A.G.T.D. was not fulfilling the contractual obligations for promoting and distributing products. According to the manufacturer, the holding’s brands were supposed to be present in approximately 4,500 retail outlets in Israel, including supermarkets, stores, kiosks, and specialized alcohol networks.
At the end of 2018 and throughout 2019, the manufacturer sent letters and messages to the distributor with a list of alleged violations. Among the claims were insufficient product presence on shelves, lack of regular market analytics, incomplete implementation of marketing programs, and weak promotion of individual brands, primarily Morosha vodka.
A.G.T.D. responded that the contract could not oblige it to ensure the presence of products literally in every store. In the opinion of the Israeli company, it was supposed to make maximum commercial efforts, but the final decision on purchasing goods was made by independent store and network owners.
It was the difference between the obligation to guarantee a specific result and the duty to make maximum efforts in good faith that became one of the main legal issues of the entire case.
Internal table and search for a new distributor
During the process, an internal table of Global Spirits was presented to the court, prepared by the holding’s legal advisor after the first unsuccessful proposal for voluntary termination of cooperation.
The document discussed how to systematically record recurring violations by A.G.T.D. to create sufficient grounds for terminating the contract. The Haifa District Court concluded that after the events of late 2018, Global Spirits indeed began “preparing the ground” for terminating the agreement.
At the same time, representatives of the manufacturer entered into contacts with other participants in the Israeli alcohol market. The case materials mentioned companies Ackerman and “Ha-Kerem”, as well as other potential partners who could receive the rights to distribute the brands after A.G.T.D.’s departure.
Global Spirits explained these meetings as a normal business necessity: if the current distributor continued to violate the contract terms, the manufacturer needed to understand in advance who could replace it in the Israeli market.
A.G.T.D., on the contrary, considered negotiations with competitors as confirmation that the decision to replace the distributor was made in advance, and subsequent checks and claims only created a formal legal basis for the already planned breakup.
Inspection of 120 retail outlets in July 2019
The key inspection of the Israeli market took place from July 15 to 20, 2019. Representatives of Global Spirits visited 120 stores, kiosks, and other retail outlets where alcoholic products could be sold.
According to the manufacturer, various holding brands were present in approximately 45% of the inspected outlets, while Morosha vodka was not found in any of the surveyed stores. Global Spirits also claimed that A.G.T.D. did not provide the inspectors with all the necessary information and did not cooperate sufficiently with them.
The Israeli distributor disputed the representativeness of the inspection and stated that a sample of 120 retail outlets does not allow judging the situation in all 4,500 stores where products could potentially be sold. Moreover, A.G.T.D. insisted that the manufacturer mistakenly interpreted the contract as a guarantee of 100% product presence.
Three weeks after the inspection was completed, on August 9, 2019, Global Spirits officially notified A.G.T.D. of the termination of the exclusive contract.
This date became the turning point of the entire story. From this moment, the business dispute turned into a multi-year legal proceeding.
Mutual lawsuits after contract termination
After the termination of the agreement, A.G.T.D. turned to the Haifa District Court and demanded the full contractual compensation of two million dollars. The case was registered in 2019 under the number 51193-10-19.
The Israeli company claimed that the contract was terminated unlawfully, as Global Spirits did not provide a reasonable period to rectify the alleged violations. In addition, A.G.T.D. continued to assert that the manufacturer had decided in advance to replace the distributor, negotiated with competitors, and only then began collecting evidence of insufficient product distribution.
Global Spirits filed a counterclaim. Various sources and versions of court documents mentioned amounts ranging from 1,441,500 to 1,633,508 shekels. Most likely, the claims were clarified during the process, or the media used different editions of the lawsuit materials.
The manufacturer claimed that during the agreement’s term, it received a profit of $322,439, but due to insufficient product presence in the market, it lost about $394,092.
Global Spirits also tried to transfer the proceedings to international arbitration in Sweden, but the dispute ultimately continued to be considered by the Haifa District Court.
What the court decided on February 28, 2024
The legal proceedings lasted almost five years. On February 28, 2024, Haifa District Court Judge Ibrahim Boulos issued a decision that essentially recognized violations by both parties.
The court rejected Global Spirits’ claim that A.G.T.D. guaranteed product presence in all retail outlets. According to the judge, the contract imposed an obligation on the distributor to make maximum efforts, as the final result depended not only on it but also on independent stores, retail chains, and buyers.
At the same time, the court found that A.G.T.D. did not effectively fulfill even this obligation. The Israeli company did not ensure proper product promotion, did not achieve the expected level of distribution, and committed significant contract violations.
Thus, the court did not recognize A.G.T.D. as a completely bona fide party. However, the presence of violations by the distributor did not allow Global Spirits to immediately terminate the agreement.
The court concluded that the manufacturer should have clearly listed the violations, demanded their rectification, and provided a reasonable period for correcting the situation. Only after such a period expired could Global Spirits decide to terminate the contract.
Since only about three weeks passed between the completion of the inspection on July 20, 2019 and the termination letter on August 9, 2019, and no real opportunity to rectify all claims was provided, the termination procedure was deemed unlawful.
Why A.G.T.D. received only a quarter of the required amount
Although the contract of December 21, 2017, provided for compensation of two million dollars, the court decided that paying the full amount would be disproportionate.
A.G.T.D. itself committed serious violations, so awarding the entire penalty would mean that the company receives maximum compensation despite the shortcomings of its own work. The court also considered that the amount specified in the contract had the nature of a penalty and did not accurately reflect the proven damage.
As a result, the compensation was reduced fourfold to $500,000, which at the time of the decision amounted to approximately 2.1 million shekels.
The counterclaim of Global Spirits was rejected.
Israeli business media reported in detail on the decision on March 19, 2024, and NEWSru.co.il published a report on it on March 25, 2024.
NAnews — News of Israel notes that the district court’s decision cannot be considered an unconditional victory for the distributor. The court found that A.G.T.D. did not effectively promote the products, but the manufacturer also violated the contract by improperly formalizing its termination.
What the parties demanded in the Supreme Court
After the decision of February 28, 2024, both parties filed appeals.
Global Spirits continued to insist that A.G.T.D.’s obligation was an obligation of result, that Morosha vodka was not actually promoted, and that numerous warnings gave the manufacturer the right to terminate the cooperation. The company also argued that paying compensation to a party that itself significantly violated the contract is unfair.
A.G.T.D. demanded to increase the awarded amount from $500,000 to two million dollars. The Israeli company again referred to the correspondence related to the employment of Yevgeny Chernyak’s son, internal documents of Global Spirits, and the manufacturer’s negotiations with other Israeli distributors.
However, the Supreme Court did not accept the arguments of either party and decided to maintain the balance of responsibility established by the district court.
How the rights to Khortytsa ended up with the Israeli company
While the Supreme Court was considering the appeals, the dispute received a new commercial continuation.
According to Ynet, the structures of Global Spirits did not voluntarily pay the awarded $500,000, after which A.G.T.D. began enforcement proceedings. As part of these procedures, the Israeli registration of the Khortytsa — “Хортица” trademark was transferred to the former distributor and registered in his name.
Ynet reported on the transfer of rights on August 12, 2025.
This concerns only the rights to the trademark in Israel. The transfer of Israeli registration does not mean that A.G.T.D. became the owner of all international rights to Khortytsa and can manage the brand in other countries.
Nevertheless, for the Israeli market, such a decision was significant, as it allowed the former distributor to independently relaunch the well-known brand.
“Khortytsa” is planned to be produced in Israel
On the same day, August 12, 2025, A.G.T.D. announced the return of Khortytsa to the Israeli market, but now with local production.
The company announced plans to invest about two million shekels in the relaunch. Initially, it was planned to release the classic version of vodka, and then add new flavors developed taking into account the preferences of Israeli consumers.
Representatives of A.G.T.D. stated that the production would be local and kosher, and the transition to the Israeli site would allow offering a more competitive price and better adapting the product to market requirements.
The company also claimed that in previous years, Khortytsa sales in Israel gradually declined due to the cessation of active marketing and the security situation in Ukraine.
Thus, the legal dispute affected not only the financial relations between the former partners but also effectively changed the model of the Khortytsa brand’s existence in Israel.
The final decision of the Supreme Court
In July 2026, the Supreme Court completed the case review. The decision was made on July 8, 2026, and Israeli media reported on it in detail on July 24, 2026.
Judges Yitzhak Amit, Dafna Barak-Erez, and Khaled Kabub concluded that the Haifa District Court correctly assessed the documents, correspondence, and testimonies of the parties. The Supreme Court did not re-examine all the factual circumstances and left the decision of February 28, 2024, unchanged.
Global Spirits is obliged to pay A.G.T.D. $500,000, while the Israeli company’s demand to receive the full two million dollars was finally rejected.
Not all participants in the dispute were registered in Ukraine
In Israeli publications, the defendants were often called Ukrainian companies, but the legal structure of the holding was more complex.
GSH Trademarks Limited was registered in Cyprus and managed the rights to a number of alcohol trademarks. The production of products was carried out by the Ukrainian-registered Ukrainian Distribution Company Ltd.
In December 2020, the rights and obligations of the Ukrainian company related to the dispute were transferred to Global Spirit Europe, which in August 2021 was officially joined to the legal process.
Therefore, the wording “Ukrainian manufacturers” reflects the origin of the business, brands, and the holding of Yevgeny Chernyak, but does not fully describe the jurisdiction of all the legal entities involved.
How the 21-year history of cooperation ended
The history of the parties’ relationship began in 2005, the contract was updated on December 21, 2017, disagreements sharply escalated at the end of 2018, the inspection of retail outlets took place July 15–20, 2019, and the agreement was terminated on August 9, 2019.
The Haifa District Court issued a decision on February 28, 2024, the transfer of the Israeli Khortytsa trademark became publicly known on August 12, 2025, and the final judicial outcome was confirmed by the Supreme Court on July 8, 2026 and published in the media on July 24, 2026.
The court found that A.G.T.D. did not effectively promote and distribute the products, but the contract did not require guaranteed product presence in every store. Global Spirits had grounds to make serious claims against the distributor but did not have the right to terminate the agreement without providing a reasonable period for correcting violations.
That is why the Israeli company received not two million, but $500,000, and the manufacturer’s counterclaim was rejected.
For Global Spirits, the consequences were broader than the direct monetary payment. During the proceedings, the rights to the Khortytsa trademark in Israel were transferred to the former distributor, who now intends to independently produce and develop the brand in the local market.
NAnews — News of Israel notes that the dispute, which began after 14 years of cooperation, ended seven years after the contract termination and 21 years after the start of business relations. Its outcome was not only the final compensation of $500,000 but also the actual change of the owner of the Israeli version of one of the most famous alcohol brands of Ukrainian origin.