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AIG Securities Litigation - Starr Defendants Settlement

IMPORTANT: The Court held a hearing on April 10, 2013, at 2:30 p.m., at the United States District Court for the Southern District of New York, United States Courthouse, 500 Pearl Street, New York, New York 10007. At the hearing, the Court approved the Settlement in the action as fair, reasonable, adequate and in the best interests of the Class Members.

PLEASE NOTE:  If you have already submitted a Proof of Claim form in connection with the previously announced settlements with defendant PricewaterhouseCoopers LLP (the “PwC Settlement”) and/or defendant American International Group, Inc. (the “Company Settlement”), DO NOT complete a new Proof of Claim form now. The trading information you already provided will be used to determine your claim in this Settlement with Maurice R. Greenberg, Howard I. Smith, Christian M. Milton, Michael J. Castelli, C.V. Starr & Co., Inc., and Starr International Company, Inc. (collectively, the "Starr Defendants”). Instead, you must complete and submit a Release Form and mail it to the Administrator by first class mail, postmarked no later than March 27, 2013.

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 Settlement 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 review the full Notice for additional details.

Please read this information carefully. If you are a Settlement Class Member (as defined below), your rights will be affected by these proceedings and you may be entitled to receive benefits under a proposed settlement.

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, (the “Class Period”) and Were Damaged Thereby, You May Be Entitled to Share in a $115 Million Settlement with the Starr Defendants. 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-Company Settlement please click here.
American International Group Securities Litigation-Gen Re Settlement 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 March 27, 2013
File an Exclusion  Postmarked no later than March 6, 2013
File an Objection  Postmarked no later than March 6, 2013
File a Release Form  Postmarked no later than March 27, 2013
Fairness Hearing April 10, 2013 at 2:30 p.m.
United States District Court
Southern District of New York

Fairness Hearing

The Fairness Hearing will be held at 2:30 p.m. on April 10, 2013 before the Honorable Deborah A. Batts, in the United States District Court for the Southern District of New York, United States Courthouse, 500 Pearl Street, New York, NY, to determine:

(a)    Whether the proposed Settlement is fair, reasonable and adequate and should be approved by the Court;

(b)   Whether the claims against the Starr Defendants should be dismissed with prejudice as set forth in the Contingent Agreement of Compromise and Settlement, dated August 10, 2009 (the “Agreement”);

(c)    Whether the proposed Settlement Class should be certified and Lead Plaintiff be certified as Class Representative and Lead Plaintiff’s Counsel be appointed Class Counsel;

(d)   Whether the proposed Plan of Allocation for distributing the Settlement to Settlement Class Members is fair and reasonable and should be approved;

(e)    Whether the application by Lead Plaintiff’s Counsel for an award of attorneys’ fees and reimbursement of litigation expenses should be approved; and

(f)     Whether the application by Lead Plaintiff for reimbursement of its costs and expenses should be approved.

The issuance of the Notice is not an expression of the Court’s opinion on the merits of any claim in the Action, and the Court still has to decide whether to approve the Settlement.  If the Court approves the Settlement, payment will be made after all appeals, if any, are resolved and after the completion of all claims processing.  Please be patient.

What is this case about?

This Action arises from, among other things, allegedly material misstatements and omissions made by certain of the Starr Defendants and others in connection with an allegedly illegal market division scheme with Marsh & McLennan Companies ("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 alleges 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 alleges 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 claims 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 alleges that AIG and certain of the Starr Defendants manipulated the price of its stock during the Class Period through a stock repurchase program. Lead Plaintiff alleges 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.

The Starr Defendants deny 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 the Starr Defendants, of any fault or liability whatsoever or of any infirmity in any defenses they have asserted or intended to assert, or of the merits of Lead Plaintiff’s claims. The Starr Defendants, while affirmatively denying liability, consider it desirable and in their best interest that the claims against them 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, the Starr Defendants have paid $115 million in cash into an escrow account that will earn interest for the benefit of the Settlement Class. The Settlement Amount will be divided, after deduction of Court-awarded attorneys’ fees and expenses, Lead Plaintiff’s expenses, Notice and Administrative Expenses, any applicable taxes, and any other expenses and awards the Court may order (“Distribution Amount”), among all Settlement Class Members who timely submit valid Proofs of Claim or Release Forms that show a Recognized Loss. Your share of the Distribution Amount will depend on several things, including: (1) the amount of Recognized Losses of other Settlement Class Members who file 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 will be calculated according to the formula shown in the Plan of Allocation. It is unlikely that you will get a payment for your entire Recognized Loss, given the number of potential Settlement Class Members with Recognized Losses. After all Settlement Class Members have sent in their Proofs of Claim or Release Forms, the payment you get will be 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. (See the Plan of Allocation beginning on page 10 of the Notice for more information.)

Once all the Proofs of Claim and Release Forms are processed and claims are calculated, Lead Plaintiff’s Counsel, without further notice to the Settlement Class, will apply to the Court for an order distributing the Distribution Amount to the members of the Settlement Class. Counsel will also ask the Court to approve payment of the Administrator’s fees and expenses incurred in connection with administering the Settlement that have not already been reimbursed.

The Rights of the Settlement Class Members 

If you are a Settlement Class Member, you have the following options:
 
If you filed a Proof of Claim in the PwC Settlement and/or the Company Settlement, you DO NOT need to file a claim in the AIG Starr Defendants Settlement  BUT you must file a Release Form to qualify for payment. You must timely submit a completed Release Form and include supporting documents, if required, (DO NOT SEND ORIGINALS) to the Administrator. A Release Form is being sent, under separate cover, to all Settlement Class Members who filed a Proof fo Claim form in the PwC Settlement and/or Company Settlement. You may also get a Release Form by clicking on the “Release Form” link on the left. Please read the instructions carefully, fill out the Release Form, include all the documents the form asks for (if required), sign it, and mail it to the Administrator by first class mail, postmarked no later than March 27, 2013.  The Administrator needs all of the information requested in the Release Form in order to determine what you may be entitled to.

To qualify for a payment if you DID NOT already file a Proof of Claim in the PwC Settlement and/or Company Settlements, you must timely submit a completed Proof of Claim form with supporting documents (DO NOT SEND ORIGINALS) to the Administrator. DO NOT SEND Proof of Claim forms to counsel for the Settling Parties or the Court.  A Proof of Claim form is being circulated with the Notice to Settlement Class Members who have not submitted a Proof of Claim in either the PwC Settlement or the Company Settlement. You may also get a Proof of Claim form by clicking on the “Proof of Claim” link on the left.  Please read the instructions carefully, fill out the Proof of Claim form, include all the documents the form asks for, sign it, and mail it to the Administrator by first class mail, postmarked no later than March 27, 2013.  The Administrator needs all of the information requested in the Proof of Claim in order to determine what you may be entitled to.

Each Settlement Class Member will be bound by all determinations and judgments in this Action concerning the Settlement, whether favorable or unfavorable, unless such person mails, by first class mail, a written request for exclusion from the Settlement Class, postmarked no later than March 6, 2013, addressed to In re AIG Securities Litigation – Starr Defendants EXCLUSIONS, c/o Rust Consulting, Inc., P.O. Box 24676, West Palm Beach, FL 33416.  No person may exclude himself, herself or itself from the Settlement Class after this deadline. You may not exclude yourself by telephone or email.

In order to be valid, each request for exclusion must set forth the name and address of the person or entity requesting exclusion, must state that such person or entity “requests exclusion from the Starr Defendants Settlement Class in In re AIG Securities Litigation, Master File No. 04-8141 (DAB)” and must be signed by such person or entity. The following information must also be provided: your name, your address, your daytime telephone number; and documents establishing the date(s), price(s), and number(s) of shares of all purchases, other acquisitions and sales of AIG Securities during the Class Period. Requests for exclusion will NOT be accepted if the requests do not include the required information, are undocumented or if the requests are not made within the time stated above, unless the requests for exclusion are otherwise accepted by the Court.

If a Settlement Class Member requests to be excluded from the Settlement Class, that Settlement Class Member will not receive any benefit provided for in the Agreement.

Any Settlement Class Member who does not request exclusion by March 6, 2013 may ask the Court to consider their objection to any of the matters to be considered at the Fairness Hearing (and may also appear at the Fairness Hearing) provided, however, that no such person shall be heard unless his, her or its objection is made in writing and is filed, together with copies of all other papers and briefs to be submitted to the Court for the Fairness Hearing, by him, her or it (including documentation of all purchases, acquisitions and sales of AIG Securities during the Class Period) with the Clerk’s Office at the United States District Court for the Southern District of New York, United States Courthouse, 500 Pearl Street, New York, New York 10007, postmarked no later than March 6, 2013, and is served on the same day, by first class mail, hand or overnight delivery to Lead Counsel for Lead Plaintiff and the Settlement Class and Counsel for each of the Starr Defendants:
 

Nicole Zeiss, Esq.
Louis Gottlieb, Esq.
Labaton Sucharow LLP
140 Broadway
New York, NY 10005
David Boies, Esq.
Robert J. Dwyer, Esq.
Boies, Schiller & Flexner LLP
575 Lexington Avenue, 7th Floor
New York, NY 10022
Lead Counsel for Lead Plaintiff
and the Settlement Class
Counsel for Maurice R. Greenberg, C.V. Starr & Co., Inc. and Starr International Company, Inc.
Vincent A. Sama, Esq.
Kaye Scholer LLP
425 Park Avenue
New York, NY 10022
Frederick P. Hafetz, Esq.
Noah E. Shelanski, Esq.
Hafetz Necheles & Rocco
500 5th Avenue, 29th Floor
New York, NY 10110
Charles I. Poret, Esq.
Benjamin E. Rosenberg, Esq.
Dechert LLP
1095 Avenue of the Americas
New York, NY 10036
Counsel for Howard I. Smith Counsel for Christian M. Milton  Counsel for Michael J. Castelli


Further Information

Further information regarding the Action, the Notice and how to file your Proof of Claim or Release form may be obtained by contacting the Administrator or reading through the Notice, Proof of Claim form 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.

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