Fresh legal war erupts hours after ‘Undercover Jew’ settlement was reached between activist and Palestine-supporting café

The longstanding saga of The Daily Telegraph’s controversial ‘Undercover Jew’ operation has faced yet another dramatic turn amid claims the parties’ joint plan to ‘respectfully’ settle the matter was ‘twisted’ at the eleventh hour.

The saga began in February 2025 when Jewish activist Ofir Birenbaum went to Cairo Takeaway, an Egyptian-style restaurant in Sydney’s Newtown, wearing a Star of David cap and necklace while being trailed by a reporter from the Telegraph.

The operation, later revealed to have had the internal codename ‘UNDERCOVER JEW’, saw Mr Birenbaum enter the restaurant, order a hibiscus tea and leave, with reporter Danielle Gusmaroli, her photographer and a videographer stationed outside.

‘Undercover Jewish man Ofir Birenbaum sees what it’s like being Jewish in Sydney. Will secretly film with his video glasses,’ Gusmaroli wrote in an internal planning document later unearthed in court.

The operation went awry when staff at the restaurant, which shares pro-Palestine content on social media, spotted the reporter and cameras.

In the furore that followed, Mr Birenbaum alleged he was defamed and held up for antisemitic attacks by Cairo Takeaway, its owner Hesham El Masry and chef Talaat Yehia.

The restaurant countersued and claimed Mr Birenbaum had trespassed in a bid to get a ‘negative reaction’ from staff and ‘seek to cause harm to the cross-claimant by portraying the Cairo Takeaway, its owner, and its staff as being antisemitic’.

The lawsuits were due to be heard in the Federal Court in May, but on Monday, the suits were dismissed with a joint statement issued from Mr Birenbaum, Cairo Takeaway and the Daily Telegraph in the paper and on the restaurant’s Instagram account, in which the three parties said the matters had been ‘resolved in a constructive and satisfactory manner’.

The Mail understands the case was settled on the day Cairo Takeaway was required by the court to pay a $50,000 security bond in dealing with the cross-claim.

The lengthy statement said the legal matters were resolved on ‘confidential terms’, with Cairo Takeaway issuing an ‘unreserved’ apology to Mr Birenbaum for the ‘false and defamatory’ statements directed at him to the media and online.

The statement offered carefully worded apologies from both the restaurant and The Daily Telegraph, with the latter apologising ‘unreservedly’ for causing distress to the restaurant and its staff by entering ‘without notice, to see if Mr Birenbaum would be treated differently’.

However Birenbaum was less measured in his personal statement, declaring total victory and noted that Cairo Takeaway would ‘issue an unreserved public apology for the lies they spread.’

‘Those lies were amplified by media, seized upon by politicians, and repeated by commentators who rushed to condemn – and who are now nowhere to be found,’ he added.

Mr Birenbaum maintained the operation – previously described in media reports as a ‘stunt’, ‘sting’ or ‘botched’ – was, in fact, ‘legitimate public interest journalism’.

He went on to insist that he was simply walking the streets of Sydney as a visibly Jewish man ‘to answer a simple question: would [he] be treated differently?’

‘The answer was yes. And when that truth was exposed, the response was not reflection – but ridiculous fabrication. I was lied about, vilified, and turned into a target,’ he continued.

‘The consequences were real: a torrent of abuse, public condemnation, and even a police raid on my home based on false reports. 

‘Too many chose to attack the person holding up the mirror rather than confront what it revealed. I stand by what we did, and why we did it.’ 

Rebekah Giles, founder of Giles George, solicitors for Birenbaum, called the settlement a ‘win’ for her client and ‘vindication for Jews across the globe’.

However, the Daily Mail understands the statements from Birenbaum and his lawyer came as a total surprise to the restaurant.

In a statement seen by the Daily Mail, lawyers representing Cairo Takeaway said the parties had specifically agreed, when conducting the confidential settlement, that nothing inconsistent with that statement would be published.

‘Unfortunately, it appears that Mr Birenbaum and his lawyers have seen fit to state things that are inconsistent with that joint statement in both word and spirit,’ the statement read.

‘Mr Birenbaum had agreed to enter Cairo Takeaway in league with the Daily Telegraph, and he knew they had a reporter and camera crew waiting outside. They all knew the Cairo Takeaway was a business that supported Palestine. That was why it had been selected for their “Undercover Jew” operation.

‘How many Australians would genuinely believe this sort of conduct was legitimately in the public interest? Or that the persons involved should be given “full credit” and owed “a debt of gratitude”? Or that it should be described as “an important win for the Australian Jewish community”?

‘It is sad that that what was meant to be a “positive example” of a “constructive and satisfactory” resolution is now attempting to be twisted.

‘The statements by Mr Birenbaum and his lawyers are inconsistent with “the respectful and dignified” outcome that was envisaged when the joint statement was agreed to.’

In yet another twist, after the statement by Cairo Takeaway’s lawyers was released, a spokesperson for Mr Birenbaum contacted the Daily Mail to make it clear that he was allowed to speak freely about his reasons for participating in the Tele’s investigation.

They further insisted that his personal statement did not breach any settlement agreement.

The restaurant, which proudly boasts a huge mural showing the Palestinian flag on a raised fist as part of the #FreePalestine movement outside the eatery, launched an online fundraiser in November to help bolster its defence fund.

The fundraiser was set up by Greens NSW Senator, David Shoebridge, who said he was supporting the restaurant because it ‘stands for something really important’.

‘It’s a business that’s here for the community. It’s a business that represents its values, and it’s a business that has been standing up for Palestine,’ Shoebridge said at the time.

‘Supporting others when they need us, that’s what solidarity is about. Every dollar you give to the fundraiser can help Cairo Takeaway keep serving the community.’

The fundraiser link remains active on Cairo Takeaway’s social media platforms, with nearly $88,000 raised so far.

The campaign states that if Cairo Takeaway’s defence is unsuccessful, and legal costs are not recovered, funds will be directed towards paying those costs.

Any surplus funds will be donated to Palestine Australia Relief and Action, a charity supporting Palestinian migrants and refugees to settle in Australia.

As for The Daily Telegraph, the Mail understands the paper stands by the principle of the operation, even while acknowledging the distress it caused in practice.

Staff believe there were clear grounds for conducting the investigation.

The paper also has a history of observational reporting designed to expose discrimination, including a previous piece documenting the experiences of a woman wearing a niqab in public.

Furthermore, Cairo Takeaways’ owner had made public statements on Instagram that warranted scrutiny.

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