Legal News

AIG Decides Not to Sue the Government Who Bailed Them Out
Download PDF
1 Star2 Stars3 Stars4 Stars5 Stars (No Ratings Yet)
Loading...

Until today, A.I.G. was in a difficult spot, at the point of uncertainty, whether or not to join a suit against the very government that had so graciously bailed them out. In 2008, A.I.G. was faced with either bankruptcy or government bailout, and chose the latter. However, the government seized 92 percent stake in the company, charged incredible interest rates, and took billions to give to Wall Street clients. What to do? Their commercials have had the tagline, “Thank you America,” and it is better to be achy than an ingrate. That is, in fact, what they finally decided as of Wednesday, not to sue America with the others who are, to stay out of the lawsuit against their savior.

Maurice R. Greenberg, A.I.G.’s former chief executive filed the lawsuit in 2011 and urged A.I.G. to join. They wanted to bring government to settlement talks. A.I.G. had the duty to at least consider joining, for the sake of their lawsuits, for their shareholders took a hit in all this, and consider it they did.

“On the one hand, from a corporate governance perspective, it appears they’re being extra cautious and careful,” opined Frank Partnoy, a former banker and law and finance professor at University of San Diego School of Law. “On the other hand, it’s a slap in the face to the taxpayer and government.”

  
What
Where


Rep. Elijah Cummings, a Maryland Democrat, felt the same way, saying that joining the suit would be the same as “suing the paramedic who just gave you CPR because he didn’t give you a pillow.”

A further commentator agreed. “Taxpayers across this country saved AIG from ruin, and it would be outrageous for this company to turn around and sue the federal government because they think the deal wasn’t generous enough,” said Elizabeth Warren, Wall Street Critic and U.S. Senator from Massachusetts.

It wasn’t so clear cut for A.I.G., however. They were smarting from the terms of their rescuer, and certainly there must be reasonable terms even in emergency situations. Deciding against joining the $25 billion suit was not easy, and could have repercussions with their shareholders.

Get JD Journal in Your Mail

Subscribe to our FREE daily news alerts and get the latest updates on the most happening events in the legal, business, and celebrity world. You also get your daily dose of humor and entertainment!!






 

Interesting Legal Sites You May Like


BCG FEATURED JOB

Locations:

Keyword:



Search Now

Mid-level Tax Associate Attorney

USA-CA-Los Angeles

Los Angeles office of an AmLaw firm seeks mid-level tax associate attorney with 3-5 years of experie...

Apply Now

Real Estate/Transactional Attorney

USA-PA-Camp Hill

Camp Hill office of our client seeks real estate/transactional attorney with experience. The candida...

Apply Now

Corporate Attorney

USA-WY-Laramie

Laramie office of our client seeks corporate attorney with 2+ years of experience.

Apply Now

RELEVANT JOBS

Associate Attorney

USA-CA-Novato

Attorneys helping people........Brayton Purcell LLP is an extremely busy plaintiff\'s litigation pra...

Apply now

Casualty Attorney II

USA-CA-Irvine

Kuluva, Armijo & Garcia is seeking an experienced and skilled California litigator for the position ...

Apply now

Legal Assistant / Paralegal

USA-FL-Tavares

Tavares boutique and growing law firm is looking for a full-time legal assistant / paralegal to work...

Apply now

Litigation Associate Attorney

USA-CA-San Francisco

Andrus Anderson LLP is a plaintiffs’ firm in San Francisco looking for a full-time associate w...

Apply now

SEARCH IN ARCHIVE

To Top