Investors seek ouster of AIG compensation chief - 2 Apr 2009

UPDATE 2-Investors seek ouster of AIG compensation chief

NEW YORK, April 1 (Reuters) - A group of investors is
seeking to oust an American International Group Inc (AIG.N: Quote, Profile, Research)
director who leads a committee it said authorized bonuses to
executives that brought the insurer to the brink of failure.

In a letter to U.S. government-appointed trustees for AIG,
officials representing large union and public pension funds
urged the withholding of votes to reelect James Orr, who chairs
AIG's compensation and management resources committee.

The group said Orr was on the committee when it approved
pay and retention awards for executives at the AIG Financial
Products unit mainly responsible for the insurer's distress.

Also on Tuesday, a retired California judge filed a lawsuit
in Los Angeles accusing several AIG directors of authorizing
about $1 billion in bonuses to executives and workers,
including $400 million doled out at the financial products unit
considered to be at the heart of the insurer's problems.

The complaint was one of dozens filed in past months
against the U.S. insurer, which has become a lightning rod for
populist anger after shelling out hundreds of millions of
dollars in bonuses despite raking in a government bailout to
stave off its collapse.

In his suit, former judge John Bible -- an AIG shareholder
-- accused several directors of falsely claiming that the
bonuses were needed to retain employees, to deflect criticism
from their decision, his lawyers said in a statement.

AIG has gotten an estimated $180 billion of government
bailouts since September, and prompted outrage last month among
Congress, the public and President Barack Obama for paying out
$165 million of bonuses tied to the financial products unit.
New York-based AIG lost $99.29 billion last year.

"The decisions made by the committee were wrong and an
inexcusable misuse of

more...http://uk.reuters.com/article/marketsNewsUS/idUKN0147108720090402