Ex-AIG CEO still wants damages in bailout case, will appeal

AP News
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Posted: Jun 16, 2015 7:56 PM

NEW YORK (AP) — The former chairman and CEO of insurer AIG says he still believes he's entitled to damages as a result of the government's 2008 bailout of the company, and will appeal a court's ruling against him.

A federal judge gave Maurice Greenberg a partial win Monday when he ruled that the $85 billion government bailout was unfairly punitive and that the government was not entitled to take ownership of AIG in return for its bailout loan. But the judge said the government doesn't have to pay damages to Greenberg and other AIG shareholders.

Greenberg says he will appeal that part of the ruling but is pleased with the rest.

Greenberg wants more than $40 billion in damages. He said Tuesday that if the government wasn't allowed to demand equity in AIG as a condition of the bailout, it's also not entitled to the money it received from selling AIG shares later.

Judge Thomas Wheeler also said the government violated the Fifth Amendment to the Constitution when it took an 80 percent stake in AIG, and that it was "unduly harsh" in its treatment of AIG compared to other companies.

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This story has been corrected to show the judge didn't find the government violated the Fifth Amendment by failing to give fair compensation to AIG shareholders.