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Date Posted: 09:09:18 04/19/08 Sat GMT
Author: Lynn
Subject: Irish insiderL dealing case settled (Baltimore Sun)

www.baltimoresun.com/business/nationworld/wire/sns-ap-ireland-insider-dealing,0,3422118.story

baltimoresun.com

Irish Insider-Dealing Case Settled

By SHAWN POGATCHNIK

Associated Press Writer

12:48 PM EDT, April 14, 2008

DUBLIN, Ireland


Investment group DCC PLC agreed Monday to pay about $65 million to settle the biggest insider-dealing case in Irish legal history after eight years of arguments that went all the way to the nation's Supreme Court.
Most of the money will go to fruit company Fyffes PLC to compensate for DCC's $135 million in profits from the February 2000 sale of Fyffes shares.
The Supreme Court ruled last year that DCC executive Jim Flavin -- then chief executive and now chairman -- used insider information from his former role as a Fyffes director to sell 31 million shares, or a 10.2 percent stake, for more than five times their purchase value.
The shares plummeted nearly 50 percent within weeks, after Fyffes issued a profit warning and abandoned its plans to sell imported fruit on the Web.
Lawyers for both companies announced the deal in Dublin High Court. DCC will pay 37.6 million euros ($59.6 million) to Fyffes and 3.4 million euros ($5.4 million) to four institutional investors that lost out: Eagle Star Insurance and Hibernian Insurance in Ireland, and U.S. investment houses Dreyfus Funds and Founders Asset Management.
The case pitted Flavin, one of Ireland's most successful entrepreneurs, against his former close friend and longtime business partner, Fyffes chairman David McCann.
Fyffes sued DCC and Flavin, but in 2005 a High Court judge ruled that Flavin did not possess price-sensitive information. The five-judge Supreme Court unanimously overturned that judgment in July 2007.
Nobody has faced any criminal punishment over the scandal. Last year the DCC board unanimously backed Flavin, insisting that he had sold the shares simply because they were soaring so high in value -- not because he knew they were about to drop.
Fyffes, which traces its origins to a London banana importer in the 1870s, is one of the biggest importers of tropical fruit to Europe and employs more than 4,800 people in 11 countries.
DCC, founded by Flavin in 1976 as Development Capital Corp. Ltd., employs more than 7,000 people in 16 countries in a wide range of investment and consultancy work.


Copyright 2008 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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