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ÌìÃÀÍøÕ¾´«Ã½´«Ã½, days before a high-profile legal fight with a company controlled by former CEO Maurice Greenberg heads to court, promised to use any funds won at trial to repay U.S. taxpayers.

“While any relief granted for ÌìÃÀÍøÕ¾´«Ã½´«Ã½’s equitable and legal claims will be subject to the findings and judgment of the court, ÌìÃÀÍøÕ¾´«Ã½´«Ã½ intends to use any monetary damages, including $4.3 billion of illicit stock sales, to repay the company’s debt to the U.S. government,” said ÌìÃÀÍøÕ¾´«Ã½´«Ã½ spokesman Mark Herr.

The case, scheduled to begin on Monday in U.S. District Court in Manhattan, relates to a long-contested block of American International Group stock held by Starr International Co., a company controlled by Greenberg.

A lawyer for Starr International was not immediately available for comment.

ÌìÃÀÍøÕ¾´«Ã½´«Ã½, claiming breach of fiduciary duty, is seeking to wrest back shares held by Starr, and the proceeds of any sales, at the same time as it tries to repay about $85 billion in taxpayer loans.

The U.S. government stepped in to save ÌìÃÀÍøÕ¾´«Ã½´«Ã½ from collapse under bad mortgage bets last September, and has put up to $180 billion at the company’s disposal since.

Starr’s ownership of ÌìÃÀÍøÕ¾´«Ã½´«Ã½ stock has been in contention since 2005 when Greenberg left ÌìÃÀÍøÕ¾´«Ã½´«Ã½. It held about 290 million shares at the time, then worth some $20 billion.

Some stock has been sold since, and the value of the remaining shares has fallen dramatically over the past year as ÌìÃÀÍøÕ¾´«Ã½´«Ã½ posted more than $100 billion in losses.

The trial is going ahead after an informal discussion between the parties about settlement last year failed, and after ÌìÃÀÍøÕ¾´«Ã½´«Ã½ more recently rejected having the matter decided by arbitration.

The case, at ÌìÃÀÍøÕ¾´«Ã½´«Ã½’s request, will be heard by a jury.

STAR WITNESS

Starr International had held a sizable stake in ÌìÃÀÍøÕ¾´«Ã½´«Ã½ since 1970 when Greenberg structured the firm as a vehicle to protect the insurer from hostile takeover.

Ted Wells, of law firm Paul, Weiss, Rifkind, is to argue on ÌìÃÀÍøÕ¾´«Ã½´«Ã½’s behalf that Starr International had a long-standing, irrevocable obligation to fund deferred compensation for ÌìÃÀÍøÕ¾´«Ã½´«Ã½ employees, something ÌìÃÀÍøÕ¾´«Ã½´«Ã½ says is even more important now given its precarious financial state.

David Boies, of Boies, Schiller & Flexner, is expected to argue on Starr International’s behalf that Greenberg used the block of stock to fund deferred compensation for ÌìÃÀÍøÕ¾´«Ã½´«Ã½ employees on a voluntary basis, and never expressly committed to continue the program indefinitely.

Starr International ceased to be a compensation vehicle for ÌìÃÀÍøÕ¾´«Ã½´«Ã½ executives in 2005. It is now run by Greenberg as a private investment vehicle and for charity.

Greenberg, 84, is expected to be called by ÌìÃÀÍøÕ¾´«Ã½´«Ã½ to testify as early as next week.

Greenberg, who had been CEO for 38 years, left ÌìÃÀÍøÕ¾´«Ã½´«Ã½ in 2005 amid a broad investigation into the insurer’s accounting practices, and use of offshore vehicles, led by then-New York Attorney General Eliot Spitzer. ÌìÃÀÍøÕ¾´«Ã½´«Ã½ settled the probes, which included the U.S. Securities and Exchange Commission and Department of Justice, for $1.6 billion in 2006.

Greenberg continues to fight the charges.

(Reporting by Lilla Zuill; Editing by Richard Chang)

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