|by Kevin McCoy, USA TODAY|
Finalizing one of the largest class-action lawsuits sparked by the 2008 financial crisis, Manhattan U.
Swain, writing in a 15-page ruling, described the settlement as "in all respects fair, reasonable and adequate," as well as in the best interests of AIG shareholders and the lead plaintiff in the case.
"We are pleased that the settlement has been approved by the Court and look forward to putting this litigation behind us," AIG said in a statement commenting on the outcome.
The settlement covers investors who bought AIG securities on U.S. financial exchanges from
The agreement also covers those who purchased or acquired AIG securities that were either in or traceable to a public offering during the same time period.
Swain also approved nearly
A court ruling gave the the law firm discretion to allocate a portion of the awards to other lawyers in the case, based on the relative values of their legal contributions.
The plaintiff group included several public employee pension funds, and was led by
"However, lurking behind AIG's success were the hundreds of billions of dollars of exposure to the U.S. residential mortgage market, including tens of billions of dollars of exposure to subprime debt that would bring the Company down," the plaintiffs argued in the consolidated class-action complaint.
The plaintiffs contended that executives of AIG and a company subsidiary "continually downplayed" the risk of credit default swaps and other mortgage-related investments that "ultimately led to a massive liquidity crisis that would have forced AIG into bankruptcy proceedings were it not for the
The government bailout resulted in U.S. taxpayers taking an 80% stake in AIG. That action is the subject of a separate