The original complaint charges American International Group, Inc. (AIG) and certain of its officers and directors with violations of the Securities Exchange Act of 1934. The complaint alleges that during the Class Period, defendants disseminated false and misleading financial statements to the investing public. The true facts, which were known by each of the defendants but concealed from the investing public during the Class Period, were as follows: (a) that the Company was paying illegal and concealed "contingent commissions" pursuant to illegal "contingent commission agreements;" (b) that by concealing these "contingent commissions" and such "contingent commission agreements" the defendants violated applicable principles of fiduciary law, subjecting the Company to enormous fines and penalties totaling potentially tens, if not hundreds, of millions of dollars; (c) that defendants had concealed the fact that AIG had engaged in illegal transactions using PNC-style structures with at least five additional insurers (in addition to PNC), contrary to defendants' claims on January 30, 2002; and (d) that as a result, the Company's prior reported revenue and income was grossly overstated. The complaint further alleges that on October 14, 2004, Elliot Spitzer announced he had charged several of the nation's largest insurance companies and the largest broker with bid rigging and pay-offs he claimed violated fraud and competition laws. On this news, AIG shares fell $6.80 to $60.19 on unusually heavy trading volume of approximately 50 million shares.

Note: AIG is a holding company that, through its subsidiaries, is engaged in a range of insurance and insurance-related activities in the United States and abroad.

On February 10, 2005, the Court entered the Order signed by U.S. District Judge Laura Taylor Swain granting the motion to appoint the Ohio Public Employees Retirement System, the State Teachers Retirement System of Ohio, and the Ohio Police and Fire Pension Fund as Lead Plaintffs. Goodkind Labaton Rudoff & Sucharow LLP and Hahn Loeser & Parks LLP were approved as co-lead counsel. That day, the Court also entered the Order consolidating all cases, not including actions brought pursuant to ERISA. The lead plaintiffs were given 60 days to file a Consolidated Amended Complaint. On April 19, 2005, a Consolidated Amended Class Action Complaint was filed.

In May 2005, a similar class action complaint, San Francisco Employees' Retirement System, et al. v. American International Group, Inc., et al., was filed against AIG and later consolidated into this 2004 case by the Order entered on June 24, 2005, in the 2005 case. According to the Complaint for the 2005 case, the Complaint alleges causes of action under Section 10(b) and Section 20(a) of the Securities Exchange Act of 1934. The named defendants are AIG, C.V. Starr & Co., Inc., Starr International Inc., General Reinsurance Corporation and certain Individual Defendants. The complaint alleges that defendants made false statements and concealed material information concerning AIG's financial condition and accounting practices relating to, among other items, non-traditional insurance products, assumed reinsurance transactions, and use of affiliated entities for executive compensation. Plaintiff alleges that AIG structured transactions for the primary purpose of accomplishing a desired accounting result, including a sham reinsurance deal set up with defendant General Reinsurance Corporation to bolster reserves, transactions with supposedly independent companies that were in fact controlled by AIG, mis-classified losses, and questionable estimates on deferred acquisition costs. The complaint further alleges that it and other class members suffered damages from this specific conduct, first revealed to the public in 2005. Plaintiff alleges that, between February 14, 2005, when AIG first disclosed that it had received subpoenas from the SEC and the New York Attorney General, and April 1, 2005, after AIG issued a press release relating to this conduct, AIG's share value fell approximately 30%. AIG has since announced a need to restate its financial statements for the years ended December 31, 2003, 2002, 2001 and 2000, the quarters ended March 31, June 30, and September 30, 2004 and 2003, and the quarter ended December 31, 2003, and that its prior financial statements for those periods should no longer be relied upon. Plaintiff's action seeks to pursue claims related to the alleged misconduct that was not revealed until 2005 and manifested by the loss of share value in 2005. Conversely, Plaintiff's action is not based upon and does not seek to represent a class to pursue claims related to defendants' participation in so-called "bid rigging" and/or "PNC" transactions, which were the subject of other regulatory investigations and civil actions originally filed in 2004, and which allegedly led to independent damages manifested by a drop in AIG's share value in 2004.