The legal action by Fyffes plc alleging insider dealing in connection with the €106 million sale of the DCC stake in the fruit distributor concluded at the High Court yesterday. Ms Justice Mary Laffoy reserved judgment.
While the judge gave no indication when she would deliver her decision, it is anticipated it will be issued late this year.
The case opened late last year and ran for 87 days, hearing evidence from senior executives and directors of both companies and experts on a range of issues, including financial markets. The evidence concluded last month and legal submissions were delivered from July 5th, concluding with the closing reply yesterday from Paul Gallagher SC, for Fyffes.
The costs of the action are expected to be very significant given the length of the case and the number of counsel, solicitors and experts involved.
The case arises as a result of the sale, over three days in February 2000, of the DCC stake in Fyffes. The court has been told the sales yielded some €85 million profit for DCC.
The action was brought against DCC plc, its chief executive, Jim Flavin, and two DCC subsidiaries - S&L Investments Ltd and Lotus Green Ltd.
The defendants denied insider dealing in connection with the share sales and pleaded the sales were properly organised by Lotus, a Dutch-registered subsidiary to which beneficial ownership of the Fyffes shares was transferred in 1995 with a view to avoiding the payment of capital gains tax on any subsequent sale of the shares.
The essential issues to be decided in the case are whether Mr Flavin "dealt" in the shares within the meaning of the relevant provisions of the Companies Act and whether information available to him prior to the sales was "price sensitive" - likely, if generally available to the market, to have a material effect on the price of the shares.
Yesterday, Mr Gallagher said Mr Flavin had played a role, and accordingly involved DCC, in connection with the share deals that went beyond anything that would entitle him to avail of the narrow exemption to the insider-dealing provisions of the Companies Act.
It was inconceivable that the people involved in the sales did not regard the fact that Mr Flavin was there dealing with the brokers and coming up with the offer as implicit advice that this was acceptable to Lotus, he said.
He said Mr Flavin's role in inducing the offer and getting Goodbody and Davy stockbrokers to make an offer to Lotus that was capable of acceptance "involves a dealing".
"Mr Flavin was clearly acting on behalf of DCC and DCC was involved from the very beginning of this and not just in terms of the execution," he added.
If Fyffes was right in its submissions that Mr Flavin, DCC and S&L dealt, and caused or procured a deal, then those parties were liable for the profit which, his side argued, had accrued to DCC. "The whole purpose was to get the profit," he said.
Mr Kevin Feeney SC, for DCC, said his side had some unease that, on the very last day of the hearing, new or extended interpretations on facts and documents were being urged in the very last speech to the court to which speech his side did not have a reply. He hoped the court would take that into account.
The case then concluded and Ms Justice Laffoy said: "It may come as no surprise that I am going to reserve judgment."
Mr Feeney and Mr Gallagher thanked the judge for her conduct of the trial.
