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AIG has to consider lawsuit against U.S.

AIG's board must consider the shareholder lawsuit, because it is charged with acting in the best interests of shareholders. But it doesn't have to agree to sue the U.S. for bailing out the company at the start of the financial crisis.

The board of insurance giant American International Group is set to meet today, to consider whether the company should join a $25 billion shareholder lawsuit against the U.S. government. The lawsuit claims AIG shareholders didn't receive adequate compensation when the federal government stepped in to rescue the firm.

AIG's former chief Hank Greenberg, who is still a major stockholder, insists the company got a raw deal and wants the firm to join in his lawsuit against the government. Uncle Sam's attorneys will be presenting their case for why the company shouldn't sue.

"It really is very much like a court proceeding, where the AIG board will be the arbiter of this dispute," says Jacob Frenkel, a corporate law attorney and former federal prosecutor. He points out that AIG's directors have a legal duty to consider significant shareholder requests like this.  

"A board that fully deliberates all the issues surrounding a particular shareholder demand," Frenkel explains, "ultimately is protected for its decision."

Indeed. AIG issued a statement late Tuesday saying its board has an "obligation and intention to consider seriously" Greenberg's demand "under applicable law." The statement said the board anticipates making its decision "in the next several weeks."

Columbia University law professor John Coffee says the AIG directors could be looking to head off further legal action against themseleves, by demonstrating that they've given Greenberg due consideration.

"That would mean that they would be immune from liability if Greenberg subsequently sued them for not suing the U.S. government," Coffee says.

Could Greenberg really turn on the company he led into a crisis? Coffee points out: Take a look at what he's already done.

"It takes a lot of gall to sue the country that bailed you out when you went into bankruptcy because of your own basic recklessness," says Coffee. 

AIG, in its statement, quoted current CEO Robert Benmosche as saying, "AIG has paid back its debt to America with a profit, and we mean it when we say thank you to the American people."

About the author

Bob Moon is Marketplace’s senior business correspondent, based in Los Angeles.
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There is this game called America's Idiots Game. The rules are complicated, but this is how to play in a nutshell:

1. One person is the "Chief AIG", a few of the players are the "Insiders", and the rest are the "Outsiders". The more Outsiders the better.

2. The Chief AIG takes money from everybody.

3. The Chief AIG puts some money to his pocket, gives some to the Insiders (so they can be the Insiders again next time), and uses the rest to buy some worthless stuff.

4. Now we have only worthless stuff on the table. The Chief AIG convinces the Insiders that this is bad for everyone.

5. The Insiders then collect more money from the Outsiders and hand it to the Chief AIG.

6. The Chief AIG now proudly announces that there is money on the table.

7. The Chief AIG then argues that he got rip off by the the Outsiders and deserves more money.

The game works better if the Chief AIG and the Insiders are friends, and the Outsiders are idiots. The winner of the game is always the Chief AIG.

Remember…it was for the benefit of these people – the wealthy investor classes composed of astounding levels of greed and capable of appalling ingratitude – that Republicans held a gun to the head of the U.S. economy and fought (tooth and nail) down to the very last moments to keep just one more dollar in their already very well lined pockets.

Please remember that when the 2014 midterms come around.

MACDONALD BANK is going forward with the $22,000,000,000 Getty/Hitler war crimes lawsuit based on J. Paul Getty’s support for Hitler beginning in 1938 and the GETTY OIL COMPANY shipments of oil during the Battle of Britain.

MACDONALD BANK

- v. -

J. PAUL GETTY TRUST; GORDON GETTY; RONALD GETTY; J. PAUL GETTY JR. ESTATE; MARK GETTY; ANNE GETTY EARHART; CLAIRE GETTY PERRY; CAROLINE GETTY; CALIFORNIA LT. GOVERNOR GAVIN NEWSOM; CALIFORNIA DEMOCRAT NANCY PELOSI AND LOS ANGELES COUNTY MUSEUM OF ART.

2003 documents declassified by UK Warfare Ministry reveal that in Oct. 1941 the pro-Nazi Jean Paul Getty employed and lodged Nazis at his Pierre Hotel in New York City; Nazis who were involved in spying on and sabotaging Allied Forces’ war production plants. An employee at the Getty owned Pierre Hotel in New York City wondered why there were so many Germans being hired and staying at The Pierre during World War II. He called the FBI and the FBI charged J.P. Getty with Espionage, FBI File 100.1202, June 26, 1940. It was the job of the FBI in peace and in war to root out internal enemies of the USA. The FBI report refers to Getty’s alliance with Göring, Goebbels & Hitler. FBI reported in 1942; that the Getty owned Spartan Aircraft Company which was the world's largest aeronautical school trained Nazis in Florida to become pilots during WWII even Pearl Harbor was attacked. 43,000 people were killed in the UK while J. Paul Getty was in Berlin still shipping oil to Hitler five months before Pearl Harbor; December 7, 1941. The mother of J.P. Getty was German. As aristocrats with treasures of art were executed -- beginning in 1933 -- with the outbreak of war; Getty assiduously added to his vast collection with the Nazis. The Ardabil carpet and Rembrandt of Marten Looten are at the Los Angeles County Museum of Art. The Gainsborough of Christie purchased in 1938 is at The Getty Museum in Los Angeles.

Jay S. Wintrob, CEO, AIG Retirement Services has already been to the bonus trough. Mr. Wintrob is also Vice-Chairman, J. Paul Getty Trust which has refused to pay our overdue bill; after we earned the Getty Oil Company shareholders $4,000,000,000. Such arrogance!

Grant MacDonald
Chairman and CEO
MACDONALD BANK INC.

I earned the Getty Oil Company shareholders 4 Billion Bucks
On the Reserve acquisition; the way they treat me -- it really sucks!
As the Getty inheritors bask in glee;
All I asked for was that they look after me.
Four billion dollars they earned on Reserve
My fee I surely deserve.
It turns out J.P. Getty may have been a Nazi;
His family even goes back to Germany.
With Hitler, Goring & Goebbels he did stand;
While trying to undermine the American land!
For paintings & artifacts he did receive
With his oil he was able to deceive?
Hoover & the FBI and Roosevelt they knew
That J.P. Getty & espionage he drew!
Many a young lad and Jew did die
As planes dropped bombs from the sky.
For years while Getty sat in Berlin
He may have committed many a sin.
The ashes and smoke from the chimneys it rose
While old man Getty sat cozy; he chose.
With artwork held tightly under his arm
Still dripping in blood -- as the real owner met harm.
Into the ovens & on meat-hooks, bullets between the eyes
Listen very carefully you can still hear their cries!
While the Gettys sit in England; at their estate at Wormsley
And Gordon sings in San Francisco
With his 727 in tow.
The Getty museum sits atop Malibu
While the corpses of World War 2 scream -- J.P. Getty -- We know you!

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