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Greenberg’s Starr International Sues U.S. Over AIG Bailout

Starr International Co., run by former American International Group Inc. CEO Maurice Hank Greenberg, has filed a lawsuit against the United States, claiming the government violated the Constitution when it took majority ownership of AIG without compensating the companys shareholders.

By Chad Hemenway | Updated on December 01, 2011

Starr International Co., run by former American International Group Inc. CEO Maurice “Hank” Greenberg, has filed a lawsuit against the United States, claiming the government violated the Constitution when it took majority ownership of AIG without compensating the company’s shareholders.

The suit, filed Nov. 21 in the U.S. Court of Federal Claims, asserts the federal government violated the Fifth Amendment when it assumed an 80 percent stake in AIG while making $182.3 billion in bailout funds available to the insurer to avoid its collapse.

Starr seeks $25 billion from the lawsuit for the company and a class of AIG shareholders. The amount is based on the value of the government’s stake in AIG as of Jan. 14, according to Starr. On that date, AIG finalized a recapitalization plan with the federal government. The government now holds a 77 percent stake in AIG.

AIG, named as a nominal defendant, declined to comment.

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