DCC PLC
30 July 2007
Further Announcement re Supreme Court Judgment
Following the Stock Exchange announcement issued by DCC plc ('DCC') on Friday
last at 6:30pm, DCC wishes to give further detail in relation to the Board's
full confidence in and unanimous support for Jim Flavin as Executive Chairman
of DCC.
At its meeting on Friday last the Board of DCC carefully considered, in Mr
Flavin's absence, whether the decision of the Supreme Court had any implications
for Mr Flavin's position. In reaching its conclusion, the Board was cognisant of
the fact that the Supreme Court decision to overturn the High Court's judgment
did not imply that Mr Flavin had used price sensitive information in the share
sales.
In its judgment the Supreme Court quoted what the High Court judgment
said on this matter and set out below is an extract from the quote:
'In my view, in this case, the evidence is not open to the interpretation
that Mr. Flavin used the information contained in the November and December
Trading Reports which is alleged to have been confidential and
price-sensitive, the negative information in relation to Fyffes' trading
and earnings performance in the first quarter of financial year 2000, so
as to enable the DCC Group to exit from Fyffes in manner which would avoid
any share price impact which would ensue from the disclosure of that
information. In my view, on the evidence, it is clear that what motivated
Mr. Flavin in his involvement in the Share Sales and what motivated the
almost total exit of the DCC Group from Fyffes in February, 2000 was the
opportunity to make a substantial profit because of the increase of
the share price on the back of wof.com. The plaintiff has not established
any evidential nexus between the profit which the Share Sales generated
for the DCC Group and the use by Mr. Flavin, or the use by any of the
boards of the corporate defendants, of the confidential information
contained in the November and December Trading Reports. On any view of
the evidence, that information simply had no bearing on the Share Sales.'
The Supreme Court judgment also stated that
'The High Court concluded that Fyffes had failed to establish a breach
of fiduciary duty on the part of Mr Flavin...'
No appeal was made against these strong findings of the High Court and the
Supreme Court judgment did not interfere with them. These findings of the High
Court stand.
Three independent non-executive directors, Michael Buckley, Maurice Keane and
Bernard Somers, consulted earlier this year with major shareholders in DCC and
with the Irish Association of Investment Managers in relation to the planned
appointment of Jim Flavin as Executive Chairman, which the Board unanimously
believed was in the best interests of shareholders. His appointment to that
position, with effect from 1 July 2007, was given widespread shareholder support
as evidenced by the fact that Mr Flavin received a 99.8% vote in favour of his
re-election as Executive Chairman at the Annual General Meeting on 20 July 2007.
The Board is strongly of the view that the continuation of Mr Flavin as
Executive Chairman is in shareholders' best interests for the reasons recently
discussed with major shareholders and with the Irish Association of Investment
Managers.
For Reference:
Jim Milton
Murray Consultants
Tel: +353 1 498 0300
+353 86 255 8400
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