NEW YORK - Facing a backlash from Washington and beyond, American International Group won't join a $25 billion shareholder lawsuit against the U.S. government over the terms of its bailout at the height of the financial crisis.
The suit was filed by Starr International, a company headed by AIG's founder and former chief executive officer, Maurice "Hank" Greenberg. It alleges that the government took nearly all the insurer's stock as part of the bailout without giving investors proper compensation. The Treasury's $182 billion bailout of the insurer was the largest of the 2008 financial crisis.
The timing of the suit could hardly have been worse for AIG. The company is in the midst of a "Thank You America" ad campaign to show its gratitude for being rescued from the brink of collapse.