On July 7, 2009, a federal jury found that Starr International, a company run by AIG’s (AIG) former CEO, Maurice “Hank” Greenberg, did not breach a trust when it ended an executive retirement plan for AIG more than four years ago.
Through a 1970 oral agreement, AIG entrusted Starr International to use the block of AIG shares acquired in a company restructuring to fund an executive retirement scheme for generations of AIG employees. AIG charged that Starr International breached that trust, and with a second claim of conversion related to sales of the stock for the company’s own use.
However, after three weeks of testimony and 4 and one half hours of deliberation, the eight-person jury returned their verdict that Starr was not liable on the two claims. The final decision is expected over the next month.
This would appear to be a personal vindication for Greenberg, now 84, who was forced out of after 38 years as AIG’s CEO. This ousting occurred as a result of Mr. Greenberg unwillingness to cooperate with an internal investigation into accounting practices at the insurer that once claimed global dominance.
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