Insurance giant AIG said Wednesday it reached a settlement of all legal disputes involving the company and former chairman and chief executive Maurice “Hank” Greenberg and his top financial officer.
The settlement call for the parties to release each other from all legal claims, including any claims by Greenberg and former chief finance officer Howard Smith against AIG for legal fees.
They agreed to submit to an independent third party Greenberg’s and Smith’s claims for past legal fees and expenses for a determination of which of those fees, up to a 150 million dollar cap, AIG is legally obligated to pay.
“We are pleased that we have resolved our differences,” said Robert Benmosche, AIG’s chief executive officer.
“The resolution of these long-running disputes will remove a significant distraction and expense and allow AIG to better focus its efforts on paying back taxpayers and restoring the value of our franchise for the benefit of all our stakeholders.
Greenberg, who led giant insurer AIG for four decades, was ousted as CEO amid an accounting probe in March 2005, before the insurance giant’s meltdown that led to the biggest-ever US government bailout.
A jury in July rejected claims by AIG that the former CEO has improperly seized some 4.3 billion dollars in company shares.
AIG was taken over by the US government last year in a massive 170-billion-dollar bailout.
