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-   -   U.S. Issues Bite the hand that saved you -- AIG plans to sue US bailout (http://www.chiefsplanet.com/BB/showthread.php?t=268621)

Msmith 01-08-2013 12:59 PM

Bite the hand that saved you -- AIG plans to sue US bailout
 
It's been almost five years since AIG's stock dropped 60 percent in a day leaving the company doomed to failure, when Uncle Sam swooped in with $182 billion to rescue it. But AIG must have a short memory, because on Monday night news emerged that the insurance company is actually thinking about suing the U.S. government over the bailout that saved it. The board will discuss the idea with shareholders at a meeting on Wednesday.

It's not so much that AIG's mad the government bailed them out. (They wouldn't be around to be mad if it hadn't.) They just wish they'd done it a little bit differently. "The lawsuit does not argue that government help was not needed," The New York Times reports. "It contends that the onerous nature of the rescue -- the taking of what became a 92 percent stake in the company, the deal's high interest rates and the funneling of billions to the insurer's Wall Street clients -- deprived shareholders of tens of billions of dollars and violated the Fifth Amendment, which prohibits the taking of private property for 'public use, without just compensation.'" Does that kind of bad attitude count as "looking the gift horse in the mouth" or "biting the hand that feeds you?" Or both? ...


As I recalled, didn't the AIG reward their executives with huge bonus for obtaining the bailout from the government? Shouldn't those exec be fired first?

Link: http://news.yahoo.com/aig-thinking-s...--finance.html

blaise 01-08-2013 01:05 PM

Whatever. They'll have their say in court. I don't know what the execs bonuses have to do with it, though.

Frazod 01-08-2013 01:06 PM

Feet first through the ****ing woodchipper with the whole damn bunch of them.

Msmith 01-08-2013 02:15 PM

Quote:

Originally Posted by blaise (Post 9296361)
Whatever. They'll have their say in court. I don't know what the execs bonuses have to do with it, though.

After the US government signed the money over for bailout, the top level exec from AIG all received $1 million USD each.

Link: http://en.wikipedia.org/wiki/AIG_bon...ts_controversy

blaise 01-08-2013 02:34 PM

Quote:

Originally Posted by Msmith (Post 9296595)
After the US government signed the money over for bailout, the top level exec from AIG all received $1 million USD each.

Link: http://en.wikipedia.org/wiki/AIG_bon...ts_controversy

Ok, so what? Why would that have anything to do with the terms of the bailout, and whether AIG has a case?

KC native 01-08-2013 02:35 PM

Yeaaaa good luck with that one guys.

Garcia Bronco 01-08-2013 05:56 PM

Don't use their business.

ChiliConCarnage 01-08-2013 11:00 PM

That article isn't really representative of what is happening but I'm sure it's written that way in order to create interest.

AIG isn't looking to file a lawsuit.

A minority stake holder in AIG (12%) has filed a lawsuit because he disagrees with the terms of the buyout and his dilution of shares, etc.. Awkwardly, it's an Investment Group owned by the former CEO.

They've been asked to join that lawsuit. That leaves AIG in a pretty tenuous position.
Technically, AIG has no legal responsibility to the government but they are responsible for protecting their share holders rights. They have to weigh whether his case has merit.
They could end up missing out on a big settlement and being sued by their share holders

Msmith 01-09-2013 05:24 PM

I guess AIG accepted the general trend:

Facing anger from Congress and the American people, AIG Inc said on Wednesday it would not sue the U.S. government over terms of the company's multi-billion dollar bailout.

Insurer American International Group had been weighing whether to join a lawsuit filed by its former Chief Executive Hank Greenberg and his company Starr International, which owned 12 percent of AIG before its $182 billion (114 billion pounds) rescue that started in 2008.

Greenberg claims the rescue was unfair to shareholders and that the Federal Reserve Bank of New York charged an excessive interest rate on its initial loan. He is seeking billions of dollars in damages.

AIG said its board had carried out its legal and fiduciary duty to consider joining Greenberg's lawsuit before making its decision. Greenberg has a case pending in the Court of Federal Claims in Washington, D.C., and is also appealing the dismissal of a lawsuit in the federal court in New York.

AIG's Chief Executive Bob Benmosche said in an interview with CNBC that ultimately the public had to trust the company.

"It is not acceptable socially for AIG to have taken this money and to think we can go back and sue the government," Benmosche said.

AIG said it would not pursue Starr's claims nor would it allow Starr to pursue them on AIG's behalf, setting the stage for a fresh legal fight between Greenberg and the company...


Link: http://news.yahoo.com/aig-says-not-j...--finance.html

BucEyedPea 01-09-2013 05:28 PM

Someone gave them a wake up call. There's a video on C-Span showing Greenberg saying the AIG bailout was not necessary and that bankruptcy was a valid option without a financial meltdown.


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