David Boies of Boies, Schiller & Flexner and John Gardiner of Skadden, Arps, Slate, Meagher & Flom yesterday filed a 50-page complaint for Starr International Company in the U.S. Court of Federal Claims. Starr, run by former American International Group CEO Maurice “Hank” Greenberg, accuses the U.S. government of violating AIG shareholders’ due process rights and using its 80 percent stake in AIG to “covertly funnel billions of dollars to other preferred financial institutions.”
The suit alleges that the federal government and Treasury Department ignored Delaware law and the U.S. Constitution in the AIG takeover, and then abused the government’s stake in the company to effect “backdoor bailouts” to domestic and foreign banks that were AIG’s counterparties in credit default swaps. Messrs. Boies and Gardiner also promise a companion suit against the Federal Reserve Bank of New York, which assumed control over AIG in 2008.
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