Cases build against insurance giant AIG
23 March 2009, 10:05 amAIG will be the next major class action case of interest for UK pension funds, according to a leading litigation lawyer.
Patrick Daniels, partner at Coughlin Stoia Geller Rudman & Robbins, said that while the door to becoming a lead plaintiff in a class action against the Royal Bank of Scotland (RBS) is now closed, he was certain cases would next be brought against struggling US insurer AIG.
“I can’t even count how many class actions there already are against AIG,” said Daniels. “AIG is one big litigation machine, it’s an unbelievable mess.”
He said that while he’s not involved with putting UK pension funds into a class action against AIG yet, he would be in the future.
Daniels is leading the securities case against RBS on behalf of three lead plaintiffs: Merseyside Pension Fund, North Yorkshire Pension Fund and Dutch fund manager MN Services.
His case hinges on the actions of RBS Greenwich Capital, a US-based subsidiary that housed the majority of RBS’s US sub-prime mortgage assets and used them to raise the capital to buy ABN Amro.
Daniels said he was confident that the courts would grant permission to pursue a class action, and “optimistic” that non-US investors would be able to participate as lead plaintiffs. Should the class certifications be issued, class representatives, or passive investors, could become involved within eight to 12 months.
The Tyne and Wear Pension Fund is currently involved in a class action dispute against UBS. Acting as a named plaintiff and class representative, Tyne and Wear is awaiting a decision from the courts to determine if the class actions will take place. Tyne and Wear’s investment officer Ian Bainbridge said UBS had filed a motion to dismiss, which the plaintiffs had challenged, and they were now awaiting a decision to be made by the US courts.
US law firm Gilman and Pastor are currently seeking a lead plaintiff for investors affected by AIG’s 0% bond between November 17, 2006 and April 10, 2008. Over 30 sales agents are named as co-defendants including Barclays Capital, Goldman Sachs, Lehman Brothers and UBS. The closing date for applicants is March 30, 2009. Stephen Everard, managing director of class actions solutions provider Goal Group, said: “It is very possible that further cases will be launched in similar AIG bonds, which were issued from 2005 onwards.”
