Magal Sues Supplier for 1.1 Million Shekels Over Defective Security Chips
Magal Security Systems is suing Ramat Gan broker Lantana Advanced for 1.1 million shekels over allegedly defective discontinued electronic chips intended for Ministry of Defense security fences.
Magal Security Systems has filed a lawsuit against Ramat Gan-based broker Lantana Advanced in the Tel Aviv Magistrates' Court, demanding approximately 1.1 million shekels in damages over a disputed supply of discontinued electronic components for security sensors. According to the lawsuit, Magal ordered 45,000 obsolete analog accelerometers from Lantana in 2024 to build warning fences designed to prevent terrorist infiltrations for the Ministry of Defense. However, the company claims that thousands of the delivered chips were defective, forcing it to urgently purchase about 10,000 replacement components from another vendor at a higher price of roughly $4 per unit.
The Role of Electronic Brokers and Discontinued Stock
Lantana, controlled and managed by Keren Kalfon, specializes in sourcing discontinued electronic components, often acting as a last resort when chip manufacturers announce the end of production. Components acquired through such channels are frequently sold at discounted prices and may not always be in original packaging or subjected to standard factory testing. Magal states that after initial defects resulted in significant losses, the parties reached a settlement agreement in 2025, under which Lantana reportedly committed to supplying original, unused components, including 5,200 units free of charge. Nevertheless, Magal alleges that the replacement shipments also contained faulty parts.
Lantana's Defense and Response
Rejecting the allegations, Lantana expressed deep astonishment regarding the legal action. The brokerage firm stated that Magal purchased the components at a reduced price specifically because they were not in their original packaging, yet subsequently rejected them on those very grounds without returning the items. Furthermore, Lantana maintains that it supplied alternative components free of charge, which laboratory tests confirmed to be fully functional. The company asserts that Magal chose to file the lawsuit to avoid payment obligations and confirmed it will defend its rights vigorously in court.
