Ex-AIG exec sues US for $25 billion

[child of wonder]

Yet another reason bailouts are a bad idea.

If he wins I hope we can change tax laws so he doesn't have to pay a single cent in taxes then he will create $25 billion in jobs!

 

[sactoking]

Offhand I would imagine that he's really got no legitimate case. As a stockholder his equity interest was subordinate to all debt interests held by bond owners. If the stock float had not occurred the company would have been liquidated and stockholders would have received nothing.

Also, the plan was approved by the Board, which was duly elected to represent the stockholders, so through his own proxy representation he approved the move.

Also, the basic gist of his argument would seem to indicate that any issuance of new stock or sale of treasury stock by a corporation which ultimately lead to diminished market cap, no matter how remotely connected, would leave the new share purchasers liable.

After all, the gov't didn't "seize" anything owned by the stockholders; the corporation issued new shares and sold them to the gov't.

 

[Zebo]

How do you know there was no harm to them? The government bailed out AIG to help protect counterparties so a domino effect would not ensue. In doing so, they reduced the value of AIG to some of the stakeholders, some of which might actually have done better if there was a complete liquidation. I'm not familiar enough with the details of this suit, but I wouldn't dismiss it outright either.

AIG had no money. The stockholders take first loss in bankruptcy and would have been wiped out 100%.

 

[Zebo]

Offhand I would imagine that he's really got no legitimate case. As a stockholder his equity interest was subordinate to all debt interests held by bond owners. If the stock float had not occurred the company would have been liquidated and stockholders would have received nothing.

Also, the plan was approved by the Board, which was duly elected to represent the stockholders, so through his own proxy representation he approved the move.

Also, the basic gist of his argument would seem to indicate that any issuance of new stock or sale of treasury stock by a corporation which ultimately lead to diminished market cap, no matter how remotely connected, would leave the new share purchasers liable.

After all, the gov't didn't "seize" anything owned by the stockholders; the corporation issued new shares and sold them to the gov't.

They do. You can't take over a company without due process. They'll get $1 trust me.

 

[sactoking]

They do. You can't take over a company without due process. They'll get $1 trust me.

It was a negotiated agreement, lack of due process not found.

 

[dmcowen674]

Screw Tony Soprano, send him down here and let the coonasses take care of him.

That is Louisiana for those not familiar with the term from there.

http://en.wikipedia.org/wiki/Coonass

 

[Ausm]

That is Louisiana for those not familiar with the term from there.

http://en.wikipedia.org/wiki/Coonass

Thx Dave being from the North I thought it meant something I haven't heard used in like 30+ years...hehe.

 

[jstern01]

Well, the government enabled them to do that. So ultimately it's the government's fault.

one word.... Bullsh&t.


The lobbyist help them write the laws that allowed Wall Street to rape and pillage the US economy (and the world's as a by product). Stop blaming government and start looking at the root problem, corporations running Washington.

 

[Zebo]

It was a negotiated agreement, lack of due process not found.

You can negotiate & agree to kill someone it still makes it illegal by the book/law.

 

[sactoking]

You can negotiate & agree to kill someone it still makes it illegal by the book/law.

Because murder is illegal. Selling an ownership interest in a corporation (stock) is not illegal.

 

[Fern]

Offhand I would imagine that he's really got no legitimate case. As a stockholder his equity interest was subordinate to all debt interests held by bond owners. If the stock float had not occurred the company would have been liquidated and stockholders would have received nothing.

Also, the plan was approved by the Board, which was duly elected to represent the stockholders, so through his own proxy representation he approved the move.

Also, the basic gist of his argument would seem to indicate that any issuance of new stock or sale of treasury stock by a corporation which ultimately lead to diminished market cap, no matter how remotely connected, would leave the new share purchasers liable.

After all, the gov't didn't "seize" anything owned by the stockholders; the corporation issued new shares and sold them to the gov't.

AIG had no money. The stockholders take first loss in bankruptcy and would have been wiped out 100%.

I don't think it's as clear as you guys do.

AIG had many profitable units/corporations. The big loser was just one division/corporation IIRC.

I'll just gloss over the fact that any CDO's or CDS's may not have actually had a value as low as mark-to-market rules suggests. I will, however, point out that AIG had a complicated corporate structure no doubt intended to provide liability 'firewalls' in the event of civil suits (including bankruptcy).

I think to make a reasonably educated guess would require far more info than we're privy to.

Fern

 

[Zebo]

Because murder is illegal. Selling an ownership interest in a corporation (stock) is not illegal.

Sigh. Contract Murder is illegal as government buying into a business without congressional approval or torture. Just because it was okayd by Turbo Timmy doesn't fly. Like I said no due process, no time like ticking bomb torture they will argue when it goes to court.

 

[RightIsWrong]

This fuck needs to realize that, if his "leadership" of the company had continued, he would have lost a lot more.

As for AIG running a scam and separating their profitable divisions from their sham of a mortgage back securities division so that they could file BK on it while protecting the others, fuck them again.

If they want to file BK, that's their right. But they should be forced to sell off all of their profitable divisions to cover every penny of losses prior to getting any relief from the balance between the two.

I'm sure that, if the govt wants to dig an inch or two below the surface, they can find a few cases of insider trading and/or tax evasion that this fucktard was committing on a daily/annual basis.

 

[Zebo]

I don't think it's as clear as you guys do.

AIG had many profitable units/corporations. The big loser was just one division/corporation IIRC.

I'll just gloss over the fact that any CDO's or CDS's may not have actually had a value as low as mark-to-market rules suggests. I will, however, point out that AIG had a complicated corporate structure no doubt intended to provide liability 'firewalls' in the event of civil suits (including bankruptcy).

I think to make a reasonably educated guess would require far more info than we're privy to.

Fern

Their profitable divisions were still divisions and paled in comparison to the back stop given to stop bankruptcy. Check the numbers. It's like they had ~12 billion in assets and 100 billion in liabilities to pay out. I'm guesstimating because I can't find article right now but it was a huge huge shortfall on that order.