After taxpayer bailout, AIG considers suing U.S.
Wednesday, January 9, 2013
NEW YORK — AIG is considering today whether the company should join a lawsuit against the government that spent $182 billion to save it from collapse.
American International Group Inc. said its board of directors will weigh whether to take part in a shareholder lawsuit against the U.S. over the government’s $182 billion bailout of the New York-based insurer.
If AIG decides to join the complaint, which seeks $25 billion in damages, it would pit the company against the government that in 2008 kept it from buckling under the weight huge losses on mortgage-backed securities and other toxic assets.
AIG said that after today’s meeting, its directors should have a decision by the end of the month.
Starr International Co. Inc., the investment firm of former AIG CEO Maurice Greenberg, filed the lawsuit in November 2011 on behalf of the firm and AIG shareholders.
The complaint, filed in the U.S. Court of Federal Claims and the U.S. District Court for the Southern District of New York, says that the government didn’t provide shareholders fair compensation when it took a nearly 80 percent stake in the insurer as part of the bailout. In doing so, the government violated the Constitution, Starr claims.