The former chief executive and chairman of Elan Corporation plc has brought a High Court (Commercial Division) action against the company, claiming he has been denied entitlements - which could exceed $12 million (€9.1 million)- under a share option scheme.

Mr Donal Geaney, said to be ill at present, has also brought a case against Elan before the Employment Appeals Tribunal for alleged unfair dismissal.

Mr Geaney claims he was given a remuneration package in November 1989 which included a total of 1.3 million share options in Elan, of which 1.150 million are held at an exercise price of $24 with the balance exercisable at a price of $37.1875. Yesterday, Mr Justice Kelly granted an order to Mr Paul Gardiner SC, for Mr Geaney, requiring Elan to discover any documents in the company's possession in relation to his claim. Mr Geaney, of Seafield Road East, Clontarf, Dublin, is claiming he initiated legal proceedings because efforts to resolve outstanding disputes between him and Elan on an amicable basis had failed.

He alleges that, some time before July 8th, 2002, a decision was taken by Elan's board of directors to remove him from the positions of chief executive and chairman. He contends he was denied fair procedures. He says he continued by agreement to be employed as a senior adviser to July 2004.

Granting the order for discovery, Mr Justice Kelly said Mr Geaney was claiming that, after meetings between Elan's senior management team and its remuneration committee in 2002, it was decided the exercise period for share options for senior executives would be extended to 24 months post-termination.

Mr Geaney claimed that, following his removal from office, he had a telephone conversation with Mr Dan Tully and Mr Garo Armen who confirmed he would be treated in the same manner as other senior executives who had left or would be leaving Elan - he would have 24 months from the date of termination in which to exercise his share options.

He was required to execute an agreement governing the terms on which he continued to be employed by Elan as a senior adviser to the chairman, under which he would continue to be paid up to July 2004.

He worked up to December 2003 on a full-time basis but subsequently on a part-time basis because of a deterioration of his health. When the agreement expired, Mr Geaney claimed that Elan unlawfully terminated his employment.

He claimed Elan had wrongfully and, in breach of agreed terms, purportedly asserted that he was not entitled to exercise the share options held by him.

He alleged Elan now contended that he was not entitled to a 24-month period post-termination of his employment to exercise his share options. In his High Court proceedings, Mr Geaney is seeking an injunction restraining Elan from interfering with or depriving him of his right and ability to exercise his share options.

In its defence, Elan denies Mr Geaney's claims. It claims he was told on July 8th, 2002 the company had lost confidence in him as chairman and chief executive and proposed to dismiss him. Elan claims Mr Geaney's primary concern at that time was to be allowed as long a period as possible for the exercise of his share options, in the hope the Elan share price would recover so his options would have some value.

To that end, Mr Geaney was granted a new two-year employment contract with the relationship being severed at the end of the contract, the company claims. At no stage did any negotiations take place in respect of extending the option-exercise period post-termination.

Under the terms of two agreements which Mr Geaney signed in July 2004, he undertook not to sue the company in respect of his employment and its termination, Elan argues. It also denies Mr Tully or Mr Armen made the representations claimed by Mr Geaney. Elan has also filed a counterclaim in the proceedings and is seeking an order directing Mr Geaney to withdraw his claims before the Employment Appeals Tribunal, and seeking an injunction restraining him from any further proceedings in respect of the termination of his employment.

The hearing was adjourned to Friday when the court will consider a motion brought on behalf of Mr Geaney to allow evidence on commission to be taken from Mr Tully who is ill in New York.