Reset Font to Default Medium Font Larger Font

AIG Securities Litigation - Company Settlement

IMPORTANT:  Lead Counsel Labaton Sucharow LLP is pleased to report that on September 30, 2014, the Court issued orders approving the initial distributions of the settlement proceeds from the four settlements in the AIG Securities Litigation – the “PwC,” “Company,” “Starr,” and “Gen Re” Settlements.  On November 18, 2014, pursuant to the Court’s Orders, 90% of the PwC, Company, Starr, and Gen Re Net Settlement Funds were distributed.  The remaining funds will be distributed at a future date to eligible claimants who cash their initial distribution payments.  If you receive a check from this distribution, please cash it promptly as it will become stale on the date listed on the check.

The following is a summary of information presented in more detail in the Notice of Proposed Settlement, Motion for Attorneys’ Fees and Expenses Award and Fairness Hearing (the "Notice"), which Class Members should have received in the mail, and which you can access by clicking on the box with that name to the left. Since this is just a summary, you should see the full Notice for additional details.

If You Purchased or Otherwise Acquired Securities Issued by American International Group, Inc. (“AIG”) During the Period from October 28, 1999 through April 1, 2005, Inclusive, (“Class Period”) and Were Damaged Thereby, You May Be Entitled to Share in a $725 Million Settlement with American International Group, Inc.

Your Legal Rights Are Affected Whether You Do Or Do Not Act.

 If you would like information about:
American International Group Securities Litigation-PwC Settlement please click here.
American International Group Securities Litigation-Starr Defendants Settlement please click here.
American International Group Securities Litigation-Gen ReSettlement please click here.

Securities Brokers and other Nominees: Please see instructions at the end of the Notice.  

IMPORTANT DATES AND DEADLINES

 File a Proof of Claim  Postmarked no later than January 23, 2012 
 File an Exclusion  Postmarked no later than December 30, 2011
 File an Objection  Postmarked no later than December 30, 2011
 File a Release Form  Postmarked no later than January 23, 2012
 Settlement Fairness Hearing  January 31, 2012 at 11:00 a.m.
 United States District Court
 Southern District of New York


What was this case about?

This Action arose from, among other things, allegedly material misstatements and omissions made by defendant AIG and others in connection with AIG’s involvement in an allegedly illegal market division scheme with Marsh and others in the insurance industry, as well as an alleged accounting fraud scheme related to AIG’s $3.9 billion restatement or adjustment of earnings in May 2005.  Lead Plaintiff alleged that, at the end of the Class Period, the price of AIG’s stock dropped significantly when these frauds were disclosed, resulting in alleged damages to the Settlement Class.

Specifically, Lead Plaintiff alleged that, on October 14 and 15, 2004, there were disclosures concerning AIG’s involvement in a market division scheme that included its payment of allegedly improper “steering” contingent commissions to, and illegal rigging of bids with, Marsh and others in the insurance industry.  Lead Plaintiff also claimed that there were disclosures in March and April 2005 of a massive accounting fraud at AIG that resulted in the Company restating or adjusting nearly four years of earnings and, inter alia, slashing net income by $3.9 billion.  In addition, the Complaint alleged that AIG manipulated the price of its stock during the Class Period through a stock repurchase program.

Lead Plaintiff alleged that the consequences of the disclosures referenced above included AIG’s payment of more than $1.6 billion to settle claims and pay fines relating to, among other things, the alleged market division and accounting fraud brought by federal and state regulators, including the Securities and Exchange Commission, Department of Justice, and the Office of the New York Attorney General. 

AIG denied all civil liability and the Settlement is not and may not be construed or deemed to be evidence of, or an admission or a concession on the part of AIG, of any fault or liability whatsoever or of any infirmity in any defenses it has asserted or intended to assert, or of the merits of Lead Plaintiff’s claims.  AIG, while affirmatively denying liability, considered it desirable and in its best interest that the claims against AIG in the Action be dismissed under the terms of the proposed Settlement in order to avoid further expense, uncertainty and distraction, and protracted litigation.

 

Terms of the Settlement

In exchange for the Settlement and dismissal of the Released Claims, AIG agreed to pay $175 million in cash into an escrow account within ten business days of preliminary approval of the Settlement.  AIG also agreed to pay an additional $550 million in cash prior to the date on which the Court entered the proposed Order and Final Judgment approving the Settlement.  In all, AIG paid the Settlement Amount of $725 million for settlement of the claims.

The Settlement Amount was divided, after deduction of Court-awarded attorneys’ fees and expenses, Notice and Administrative Expenses, any applicable taxes, and any other expenses and awards the Court may have ordered, among all Settlement Class Members who timely submitted valid Proof of Claim forms that showed a Recognized Loss. Your share of the Distribution Amount depended on several things, including: (1) the amount of Recognized Losses of other Settlement Class Members who filed valid Proofs of Claim; (2) how many AIG Securities you bought; (3) how much you paid for them; (4) the type of security bought; (5) when you bought them; and (6) whether or when you sold them (and, if so, for how much you sold them).

Your Recognized Loss was calculated according to the formula shown in the Plan of Allocation.  It is unlikely that you got a payment for your entire Recognized Loss, given the number of potential Settlement Class Members with Recognized Losses.  The payment you got was a portion of the Distribution Amount equal to your Recognized Loss divided by the total of all Settlement Class Members’ Recognized Losses and multiplied by the total Distribution Amount.  If you received any payment from the fair fund created in SEC v. American International Group, Inc., 06 Civ. 1000 (S.D.N.Y.) (LAP) (“Fair Fund Distribution”), your Recognized Loss was reduced by seven-eights (7/8th) of your Fair Fund Distribution (“Fair Fund Ratio Amount”).  In no event did you recover more than your Recognized Loss reduced by your Fair Fund Ratio Amount.  No one received a distribution from the Settlement that exceeded 100% of their total Recognized Loss(es).

 

Further Information

Further information regarding the Litigation, the Notice and your Proof of Claim or Release form may be obtained by contacting the Administrator or reading through the Notice, Proof of Claim and Release Form links on the left.

Disclaimer

IMPORTANT: THIS SITE IS NOT OPERATED BY AIG.  THIS SETTLEMENT IS SUPERVISED BY LEAD PLAINTIFF’S COUNSEL.  THE ADMINISTRATOR HANDLES ALL ASPECTS OF CLAIM PROCESSING. THIS IS THE AUTHORIZED WEB SITE FOR THIS SETTTLEMENT; INFORMATION CAN ALSO BE FOUND ON LEAD PLAINTIFF’S COUNSEL’S WEBSITE WWW.LABATON.COM. PLEASE DO NOT RELY UPON OTHER SITES THAT SET OUT DIFFERENT AND UNAUTHORIZED INFORMATION.

View the Privacy Policy