Posted Wednesday, Jan. 9, 2013, at 3:30 PM
AIG has launched an ad campaign to publicly thank the public for bailing out the insurer
Photo by STAN HONDA/AFP/Getty Images
UPDATE: American International Group’s board has decided not to join a lawsuit against the U.S. government over the terms of its rescue package, reports the Associated Press. News that AIG was even considering the possibility led to lots of backlash from Congress and the public at large, particularly since it was coming at a time when the company is running an ad campaign thanking the country for the rescue. AIG’s board said it was legally required to consider whether it would join a lawsuit brought by its former chief executive, Maurice “Hank” Greenberg, over the terms of the $182 billion bailout.
"America invested in 62,000 AIG employees, and we kept our promise to rebuild this great company, repay every dollar America invested in us, and deliver a profit to those who put their trust in us," Chairman Steve Miller said in a statement, according to Reuters.
Tuesday, January 8: American International Group, the insurer that received one of the biggest rescue packages to come out of the financial crisis that ultimately amounted to a whopping $182 billion might join a lawsuit against the government. The company’s board of directors will hear arguments on both sides of the question of whether to join the $25 billion lawsuit, reports the Wall Street Journal. The 2011 suit, filed on behalf of a company led by AIG’s former chief executive, Maurice “Hank” Greenberg, claims the government deprived shareholders of profit and charged exorbitant interest rates. The government eventually took a 92 percent stake in the company. And when the U.S. Treasury completed its final sale of the insurer’s stock last month, it said the bailout ended with a “positive return of $22.7 billion,” notes Reuters.
If AIG does decide to join the lawsuit the timing would be rather awkward considering the company has launched a television campaign called “Thank you, America” that publicly thanks the country for the bailout. Still, as the New York Times, which was first to report the news, points out, the choice to join the suit isn’t as simple as it may seem at first. If the board fails to properly consider the case it could get in trouble with shareholders. And if the suit were to win a big payout without AIG’s participation then the company could itself face lawsuits from other shareholders.