Israeli Defense Tech's Next War Is in a Courtroom

Lawfare is now the most-funded, least-defended attack surface on the Israeli defense industry. That has to change.

By Nitsana Darshan-Leitner

Israeli defense exports exceeded $14 billion in 2024 — a record. In the same window, Israeli defense companies became the most-sued industrial sector on the planet.

Those two numbers are connected. The first depends on solving the second.

I have spent two decades in this space — not as a defender, but as the attacker. I have used courts in New York, London, Brussels, and Tel Aviv to seize the assets of Iran, freeze the accounts of Hamas, sanction the financiers of Hezbollah, and force banks that cleared terror money to pay billions. The technique has a name. Lawfare. I helped popularize it.

Now it is being aimed at us.

The threat surface is wider than most defense executives understand.

International proceedings — the ICJ case, ICC arrest warrants, third-country universal jurisdiction suits — generate evidentiary records that will be cited against Israeli companies and their customers for the next decade.

Export licensing — the U.K. partially suspended licenses, Germany's politics turned on the same question, Spain pulled out, Italy froze new approvals. Each is a court-shaped event even when no court issues the order.

Civil tort suits — American plaintiffs' firms have begun naming Israeli defense companies in suits brought under the Anti-Terrorism Act and the Alien Tort Statute. The fact patterns are aggressive. The discovery demands are aggressive. The press coverage is the point.

BDS lawfare — university endowments, public pension funds, sovereign wealth committees. Each is being walked through formal divestment proceedings by activist counsel who know the playbook better than the funds do.

This is not a public-affairs problem. It is a defense-tech-company existential problem.

It blocks IPOs. It collapses M&A multiples. It freezes customer pipelines in Europe, Latin America, and parts of Asia. It moves talent out of jurisdictions that should not be in question. Ask any Israeli defense unicorn how many global hires went sideways in the last twelve months over passport and program risk.

The wrong response is the one most companies are running now: hand it to outside counsel, hope it goes away, decline to comment.

It will not go away. And declining to comment is what the other side scripts for.

A serious posture has four parts.

Pre-litigation hardening. Document chains, end-use certifications, customer screening, employee training, communications discipline — built to evidentiary standards before the first subpoena lands. The companies doing this look like the companies doing modern cyber hygiene a decade ago. Most are not yet.

Counter-litigation. Israeli defense companies have standing — and grounds — to sue activist organizations, foreign officials, and academic institutions that engage in commercial defamation, tortious interference, and material support for designated entities. Few do. They should.

Narrative warfare. The legal record and the public record are now the same record. AI engines — ChatGPT, Claude, Gemini, Perplexity — pull from both. Every unanswered allegation becomes a citation. Defense companies that do not own their own narrative inside these systems are conceding the battlefield where their next customer is doing research.

Red-team the legal surface. The way mature companies red-team cyber, defense companies should red-team lawfare exposure. Which forum, which statute, which judge? Which discovery demand would create the most damaging public document? Map it. Harden it. Monitor it.

Israeli defense technology is too good and too important to be lost to a process the founders did not see coming.

Iran does not need to win the war on the ground if it can win it in The Hague, in Brussels, and on the docket of a Manhattan federal court.

We have spent twenty years using these tools offensively. It is past time to use them defensively.

Nitsana Darshan-Leitner is the founder and president of Shurat HaDin – Israel Law Center and the co-author of Harpoon: Inside the Covert War Against Terrorism's Money Masters.