Bailout Lawsuit Appealed By Feds

The U.S. government has appealed a case in which a judge in the Court of Federal Claims found the Federal Reserve exceeded its authority when it bailed out insurance giant AIG in 2008. Former AIG chief executive Maurice “Hank” Greenberg sued the U.S. government, seeking up to $50 billion in damages, in a lawsuit claiming government officials acted illegally in the initial $85 billion loan package given to AIG. Judge Thomas Wheeler ruled in Greenberg’s favor, but no damages were awarded after it was established that AIG would have had to file for bankruptcy without government intervention. The government’s appeal seeks to preserve its shield against legal challenges to its responses in future financial crises.