Lawyers for former American International Group CEO Maurice “Hank” Greenberg and the company's former CFO have filed motions primarily aimed at having a New York court throw out charges dealing with a decade-old reinsurance deal, or, in the alternative, for another judge to handle the case.
The case alleges Greenberg and Howard Smith, former AIG CFO, engineered a sham transaction in 1999 and 2000 in order to make its financial statement look better.
The transactions have been the subject of a number of New York and federal court cases.
In the criminal case, four former Gen Re executives and a former AIG executive were found guilty in 2008 of engineering the reinsurance deal. In 2011, however, a federal appeals court threw out the convictions and ordered a new trial, citing errors by the judge. Last year, the former executives admitted to conducting the fraudulent transaction and cut deals to end the criminal case against them.
New York Attorney General Eric Schneiderman is pursuing the case even though two former state governors asked him in May to drop it. New York's highest court, the Court of Appeals, cleared the case for lower court action last month.
The case was originally filed by former attorney general and governor Elliot Spitzer in 2005. However, the key damage claims are no longer part of the case because of an unrelated 2008 Court of Appeals ruling.
The motion for summary judgment in the case, filed Friday, included a separate motion asking that Judge Charles E. Ramos, transfer it to another judge.
A third motion seeks a delay in further proceedings until the recusal motion is heard.
David Boies of Boies, Schiller & Flexner, New York, Greenberg and Smith's lawyer, said the case should be dismissed “because the attorney general, who no longer seeks damages, should not be allowed to prop up his meritless case by seeking remedies to which he is not entitled as a matter of law.”
Boies adds, “The defendants are further entitled to have the case decided by a judge who does not have the appearance of partiality.”
Amongst the issues brought up in the motion for summary judgment is the fact that earlier agreements and court decisions mean that, even if Greenberg, 88, and Smith, 68, are found guilty, the most likely practical outcome would be barring them from participating in the securities industry and from serving as officers and directors of public companies.
In their motion to have Ramos recuse himself, Greenberg and Smith allege during prior proceedings in 2010, Ramos “made a number of statements that continued to demonstrate the appearance of partiality against defendants.”
The motion also alleges that, prior to summary judgment, “Ramos has also been aggressive and argumentative toward counsel for defendants, even on occasion going so far as refusing to give counsel for defendants a fair chance to speak.”
Want to continue reading?
Become a Free PropertyCasualty360 Digital Reader
Your access to unlimited PropertyCasualty360 content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Breaking insurance news and analysis, on-site and via our newsletters and custom alerts
- Weekly Insurance Speak podcast featuring exclusive interviews with industry leaders
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical converage of the employee benefits and financial advisory markets on our other ALM sites, BenefitsPRO and ThinkAdvisor
Already have an account? Sign In Now
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.