Court directs release of expert reports to Fyffes

The High Court has ordered the release to Fyffes of up to five expert reports that DCC gave to the senior Davy stockbroker Kyran McLaughlin when it was trying to bring an end to a criminal investigation into alleged insider dealing in Fyffes shares by DCC.

The order was made after a new application by Fyffes in light of DCC's voluntary disclosure last month that Mr McLaughlin received some of the reports it gave to the Irish Stock Exchange and the Director of Public Prosecutions (DPP) in early 2000.

DCC was making efforts at that time to exercise influence on the stock exchange in the hope that the exchange would then seek to persuade the DPP not to proceed with the criminal investigation.

The hearing before Mr Justice Thomas Smyth yesterday was separate to proceedings in Fyffes' civil action against DCC before Ms Justice Laffoy.

DCC will decide in the next two days whether to appeal Mr Smyth's ruling, whose effect is to reverse an earlier High Court ruling that was upheld by the Supreme Court.

Davy Stockbrokers is broker to Fyffes and broker to DCC.

It emerged in court yesterday Mr McLaughlin has been subpoenaed by DCC to appear as a witness in the case. His appearance is expected in the next fortnight.

Paul Gallagher, SC for Fyffes, argued that the disclosure of some of the reports to Mr McLaughlin gave an "incalculable advantage" to DCC because Fyffes had not been aware that some of the reports were given to him.

Four of the reports in question were written by PricewaterhouseCoopers (PwC) and three individuals who are likely to be called as expert witnesses in the case.

The fifth report is understood to have been written by Investment Bank of Ireland.

It has not been made clear how many or which reports Mr McLoughlin received. ...

However, Mr Gallagher said in an affidavit that it was clear from evidence before the High Court that Jim Flavin of DCC "has had extensive communications with Mr McLaughlin" in connection with the evidence that he is to give at the trial on behalf of DCC.

He referred to a letter of August 4th last year in which a senior DCC executive Michael Scholefield wrote to Mr McLaughlin in connection with his version of events.

This letter set out for Mr McLaughlin a "more factual response" in relation to issues raised by the stock exchange with DCC.

He also referred to a file note prepared by Mr Scholefield "and approved by Mr Flavin" of a conversation between Mr Flavin and Mr McLaughlin on August 10th, 2004.

For DCC, Mr Michael Ashe SC argued that "confidential disclosure" to Mr McLaughlin was appropriate because Davy was concerned with the stock exchange investigation as broker to the company.

The proceedings yesterday followed DCC's disclosure in the main case that it had made an "error" in failing to disclose that Mr McLaughlin and two other figures had been given some or all of the expert reports

Mr Ashe said "these were extremely limited disclosures of confidential documents" made on a strictly confidential basis. There was no express waiver of privilege over the documents, he said.

The five reports were given to an unnamed senior banker in an effort to persuade his bank to abandon counterparty proceedings in the case which had issued but not served.

Two of the reports went to DCC's stockbroker in London, Cazanove, for the purpose of obtaining their advice on the listing regulations in relation to adverse trading information.

While directing the release of the reports DCC gave to Mr McLaughlin, Mr Justice Smyth rejected Fyffes' application for the reports it gave to the senior banker and the London broker.