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American International Group Inc. has filed a lawsuit against a vehicle created by the Federal Reserve Bank of New York to help bail out the insurer, in a bid to preserve its right to sue Bank of America Corp .and other issuers of mortgage debt that went sour.

The complaint filed in the New York State Supreme Court in Manhattan seeks a declaration that ÌìÃÀÍøÕ¾´«Ã½´«Ã½ has not transferred billions of dollars of “litigation claims” to Maiden Lane II, including many related to the insurer’s $10 billion lawsuit against Bank of America.

Maiden Lane II was created in December 2008 to buy residential mortgage-backed securities (RMBS) from ÌìÃÀÍøÕ¾´«Ã½´«Ã½ and ease liquidity strains.

According to the complaint, New York Fed officials in December told Bank of America that Maiden Lane II had, by agreeing to buy the securities, assumed from ÌìÃÀÍøÕ¾´«Ã½´«Ã½ all litigation claims relating to what it bought. ÌìÃÀÍøÕ¾´«Ã½´«Ã½ said this included more than $7 billion of damages claims against Bank of America.

ÌìÃÀÍøÕ¾´«Ã½´«Ã½ is not seeking monetary payments in the lawsuit, but wants the court to clarify that the New York-based insurer still has the right to sue issuers of securities in Maiden Lane II.

New York Fed spokesman Jack Gutt declined to comment. Bank of America spokesman Lawrence Grayson also declined to comment.

The lawsuit is part of the fallout from ÌìÃÀÍøÕ¾´«Ã½´«Ã½’s $182.3 billion federal bailout that began in September 2008, and which was fully paid off last year.

It came after ÌìÃÀÍøÕ¾´«Ã½´«Ã½ provoked a firestorm in Congress and from the American people this week as it mulled whether to sue the government that bailed it out by joining a $25 billion lawsuit by former Chief Executive Maurice “Hank” Greenberg. ÌìÃÀÍøÕ¾´«Ã½´«Ã½ eventually decided to stay out of that case.

When it sued Bank of America in August 2011, ÌìÃÀÍøÕ¾´«Ã½´«Ã½ accused the Charlotte, North Carolina-based lender of misrepresenting the quality of more than $28 billion of securities it had bought from the bank and its Countrywide and Merrill Lynch units.

An ÌìÃÀÍøÕ¾´«Ã½´«Ã½ spokesman said Friday’s lawsuit “narrowly seeks a declaration from the Court that a 2008 contract between ÌìÃÀÍøÕ¾´«Ã½´«Ã½ and ML II did not transfer to ML II ÌìÃÀÍøÕ¾´«Ã½´«Ã½’s right to sue Bank of America and other financial institutions for the billions of dollars of damages they caused ÌìÃÀÍøÕ¾´«Ã½´«Ã½ and its shareholders in connection with the fraudulent sale of RMBS to ÌìÃÀÍøÕ¾´«Ã½´«Ã½.”

According to Friday’s complaint, Maiden Lane II paid $20.8 billion for a variety of subprime and other mortgage securities from ÌìÃÀÍøÕ¾´«Ã½´«Ã½, barely half of their estimated $39.3 billion face value.

The case is American International Group Inc. et al v. Maiden Lane II LLC, New York State Supreme Court, New York County, No. 650115/2013.

Topics Lawsuits New York ÌìÃÀÍøÕ¾´«Ã½´«Ã½