A small meat processor who claims he was wrongly 'hung out to dry' during the horse meat scandal may have to withdraw a defamation action against one of Larry Goodman's companies.

Martin McAdam's company McAdam Food Products Ltd has been told that in order to proceed, it will have to provide security for costs to the ABP Food Group - which is defending the action.

ABP used to own the Silvercrest meat processing facility in Co Monaghan, where equine DNA was found in beef burger products last year.

A press release confirmed Silvercrest bought beef products from McAdam's Food Service.

McAdam's claims the business was brought to its knees by this allegedly defamatory statement - but ABP has said in its defence it will argue that McAdam's did supply beef products containing horsemeat.

But before the case goes to a full hearing, the Larry Goodman company wanted the assurance that if McAdam's lost the action it would be in a position to pay its six figure legal costs.

High Court President Nicholas Kearns agreed McAdams has to provide security for costs to ABP . If they cannot, their case can go no further.