The High Court was told yesterday that fruit distributors Fyffes was taking legal proceedings against Development Capital Corporation (DCC), DCC chief executive Mr Jim Flavin and two other companies.

When the matter came before Mr Justice Smyth, Mr Paul Gallagher SC, for Fyffes, said he was seeking an order directing that the proceedings between the parties be commenced by way of plenary summons. In addition to DCC and Mr Flavin, the other defendants in the action are S&L Investments of DCC House, Stillorgan, Co Dublin, and Lotus Green of Fitzwilton House, Wilton Place, Dublin, a DCC subsidiary which owned 10 per cent of Fyffes.

Mr Michael Collins SC, defending, said he was consenting to the order being made. In documents already prepared, Fyffes claims that, as a non-executive director, Mr Flavin had detailed financial information on Fyffes' trading for November and December 1999 and trading forecasts for January 2000 and that he took advantage of this information to procure the sale of DCC's stake in Fyffes in February 2000 at a profit of €85 million or £67million.

Mr Flavin has rejected the claim that he had price-sensitive information and has denied that he passed on any such information to Lotus Green, the Dutch subsidiary of DCC which had control over the Fyffes' shareholding. Mr Flavin is not a director of Lotus Green.

Last Thursday, DCC in a statement to the Irish Stock Exchange denied allegations of insider trading.