we'll see you soon. >> up next, aig's board says no good on joining hank greenberg's lawsuit. the insurance giant shying away from greenberg's suit alleging the government took advantage of aidentifying. the head of aig, show bob benmosche here exclusively on the other side of the break and boeing says it has extreme confidence in the 787 dreamliner. how safe are they following the string of recent mishaps? top industry experts will join me. stay with us on the "closing bell." ♪ ♪ ♪ [ male announcer ] don't just reject convention. drown it out. introducing the all-new 2013 lexus ls f sport. an entirely new pursuit. thor gets great rewards for his small business! your boa! [ garth ] thor's small business earns double miles on every purchase, every day! ahh, the new fabrics. put it on my spark card. ow. [ garth ] why settle for less? the spiked heels are working. wait! [ garth ] great businesses deserve great rewards. [ male announcer ] the spark business card from capital one. choose unlimited rewards with double miles or 2% cash back on every purchase, every day! what's in your

a lawsuit started by hank greenberg. disgraced former ceo of aig who was forced out by the board in 2005 after allegations of fraud and who is currently suing the u.s. government on behalf of aig shareholders for $25 billion. their claim, that the terms of the free bailout money they received were unfair. not enough of the free money benefited the shareholders who would have had nothing had the government not bailed them out. and just allowed them to declare bankruptcy. instead, the taxpayer money was used to pay the wall street clients who held policies with aig, the ones they made promises but couldn't keep. so that very same aig that only exists today because you and me, we the people, the taxpayers gave them $182 billion in a bailout, is now suing us because their shareholders missed out on additional profits to. quote senator elizabeth warren... >> john: this would be like the french suing because we left a few divots in the sand at arm andy. joining us is ceo of better markets, dennis kelleher. good evening. thank

hank greenberg. >> jon: noo! hank greenberg! all right not necessarily jewish.e could have changed his name from stuart. [ laughter ] by the way, i've never seen a man closer to saying the words release the hounds. [ laughter ] interesting side note, maurice hank greenberg is not only suing the u.s. government for so rudely saving his company, he is also attacking them in a new book set to be punished january 29. it's the exact same day that i'm releasing my book which is is called "don't buy maurice greenberg's (bleep) book." if you buy only one book this year about the stupidity of a book make it" don't buy maurice greenberg's (bleep) book." >> it's a ludicrous argument. >> talk about the hand that feeds you. >> they had a choice. they could have gone bankrupt they took our cash. >> i was stunned about. this i think it's crazy. >> jon: let's rein it in here. what aig shareholders are doing is objectively all of, but shock, surprising? aig, they put the a in (bleep). [ laughter ] don't you remember what happened right after we gave them the bailout money in 200

does hank greenberg's argument have validity?, this has worked its way through the judicial process already, through the judicial system. hank greenberg -- this lawsuit was thrown out by one court. it was then appealed to another court, and the second court has said you have to go to the board and see if they want in on this. it's a serious case. david boies, who we know is representing the shareholders, they sequestered -- they requested 16 million documents. they've since reduced that to about 10 million. but they're trying to determine the relationship that the united states treasury had with aig to see whether they knew of what was going on beforehand going all the way back to 2005. so it's not a penny ante lawsuit. it's -- >> could aig have not taken the lifeline? >> no. no. if aig didn't take the lifeline, aig would have gone under. and the consequence of aig going under is that aig insures every airplane you ever fly on. they insure every business that takes place in the world. this would have really brought the planet to

. >> next hour, hank greenberg, former ceo of aig. >> numbers from amazon as soon as they hit the tape as well. so what scares you out there? everybody says the market is overbought. yeah, so. sentiment is still good. what scares you? >> you know, the market may be overbought, but there's still more room on the upside. i think it's going to be a very, very narrow trading range. i don't think there's a high risk to put in your money now. i don't know if the return is -- you may have looked at a 20% return, you know in, september of last year. now we might be looking at a 5%, 10% return. risks are now muted. i don't real very any fears. i don't see anything on the horizon. >> how long can the market continue to go up if apple doesn't participate at all? >> still the market is going to go up. apple is a big nasdaq number, but as far as the s&p, it's not in the dow. s&p 500 stock but that's well weighted for everybody, so i don't think it's that big a deal. >> all right. there's the bell, peter. thank you. amazon numbers out momentarily. maria and our expert team will break them all down f

hank greenberg, you interviewed him on fox business. he is essentially saying, look, this turned into a backdoor bailout for other wall street companies. we have a right to sue based on fifth amendment rights. the government is not allowed to take private property for public interest. here is what he said on fox business. >> as far as i'm concerned that bailout should never have taken place. the way it did take place was wrong. aig was used as a backdoor bailout for many others. >> reporter: and those many others include sachs and others. they are saying they did have a choice and that was bankruptcy. aig is saying it may decide by the end of the month to whether or not to join the lawsuit filed by hank greenberg. it's saying it has to hear out on his lawsuit, that is the if i deesh year duty and it might have other lawsuits. >> neil: what wall street is seeing a trend, you bail and you get better get ready for hell? >> let's take stock where aig is. record amounts plot of built in the last couple of quarters. revenues are up big time.

hank greenberg says, wait a second, there is more to this story.ur very own neil cavuto this turned into a back door bailout for wall street. take a listen to what hank greenberg told neil cavuto. >> as far as i'm concerned that bailout should have never taken place. >> really. >> the way it did take place was wrong. aig was used as a bailout, as a back door bailout for many others. >> what he is referring to there is goldman sachs, deutsche bank and societe generale. aig's board, telling fox business it is the board's fiduciary duty to consider hank greenbergs lawsuit. melissa: they have to consider it. doesn't mean think will join in. this is hank greenberg who has been disgruntled for a long time. it is important to separate this out. >> they have to hear him out because it could expose the board to more shareholder lawsuits. there are no merit to the allegations that aig had alternative bankruptcy. melissa: emac, thanks so much for that report. it is quarter to. as we do every 15 minutes let's check the markets. nicole petallides is on the floo

they aren't necessarily because the original lawsuit was brought by hank greenberg, who is no longer the ceo of the company. explain that to us. >> sure. so hank greenberg, who leads starr international, the plaintiff who is prosecuting this derivative lawsuit now, is prosecuting a lawsuit, one was in new york. that got thrown out. now there is one left in d.c. here in federal court, for $25 billion, saying that when the company came in and saved everybody's life and everybody's jobs it did it inadequately without fair due process and adequate compensation. there is a board meeting with where starr and hank greenberg advocates the board to intervene and jump into the case and some individuals from the government saying don't do that, that's crazy. melissa: do they have a case? point that he makes as crazy as this whole thing sounds on its face the point that he makes sort of resonates that aig was used as a back door way for the company to bail out kinds of other companies because there were so many other companies that would have gone down if aig went down. that this is sort of thei

here is hank greenberg on that end.. >> as far as i'm concerned that bailout never should have taken place. and the way it did take place was wrong. aig was used as a bailout, as a back door bailout for many others. >> reporter: those many other the board has to take up considering whether or not to join its lawsuit. it's telling fox business it will do so. it could face other share older lawsuits without even considering whether to join the suits. take a look at what the new york fed is telling fox business about the merit of this lawsuit. they are saying there is actually no merit to the allegations. aig's board had an alternative choice, bankruptcy and the federal reserve's action helped restore. they will be deciding whether or not to join hank greenberg's lawsuit against the government. jon: they may have a point. you convinced me. thank jew jon i'm sure you remember 20,000 leagues under the sea, who can nor get that, right? ha look at the real life wreath that you are might have inspired what we've tauld a tale fo

what is interesting, the former aig chief hank greenberg said, wait a second.nt rights. starr international is a investor in aig. he says they took private property for public use. this became a back door bailout for goldman sachs. ashley: that's right. >> and for deutsche bank and societe generale. ashley: the interest rate for aig a lot higher than -- >> new york fed by the way saying there is no merit to the allegations. aig had alternative choice, bankruptcy. big fight going on. sandra: it continues. liz macdonald we'll continue to follow that story. ashley: thank you, emac. mcdonald's getting a name change. sandra: huh? ashley: we'll tell you where. in a minute, bruce. good day. ♪ . music is a universal language. but when i was in an accident... i was worried the health care system spoke a language all its own with unitedhealthcare, i got help that fit my life. information on my phone. connection to doctors who get where i'm from. and tools to estimate what my care may cost. so i never missed a beat. we're more than 78,000 people looking out for more than

hank greenberg filed suit on behalf of shareholders asking for $25 billion in damages. he alleges the terms of the bailout were too harsh, including 14.5% interest on its initial loan. but columbia law professor jack coffee does not think the suit will be successful: >> i think its a longshot suit, he has alleged very specific facts, that the federal government was seeking to take over a.i.g. and run it for the best interest of others and not its shareholders, but it is very, very rare that a federal court will allow a derivative action to proceed against third parties. >> reporter: a.i.g. was legally obligated to consider joining the suit. but today's board meeting comes on the heels of a new high- profile compaign, in which a.i.g. expresses gratitude for the bailout. >> thank you america. thank you america. thank you for the freedom to ensure a brighter future. >> reporter: and that's what the public wanted to hear all along. erika miller, "n.b.r.," new york. >> susie: robert doll, chief equity strategist of nuveen asset management says he's "moderately positive" on t

hank greenberg filed suit on behalf of shareholders asking for $25 billion in damages. he alleges the terms of the bailout were too harsh including 14.5% interest on its initial loan. but columbia law professor jack coffee does not think the suit will be successful: >> i think its a longshot suit he has alleged very specific facts, that the federal government was seeking to take over a.i.g. and run it for the best interest of others and not its shareholders, but it is very, very rare that a federal court will allow a derivative action to proceed against third parties. >> reporter: a.i.g. was legally obligated to consider joining the suit. but today's board meeting comes on the heels of a new high- profile compaign, in which a.i.g. expresses gratitude for the bailout. >> thank you america. thank you america. thank you for the freedom to ensure a brighter future. >> reporter: and that's what the public wanted to hear all along. erika miller, "n.b.r.," new york. >> susie: robert doll, chief equity strategist of nuveen asset management says he's "moderately positive" on the

. >> why did they say no to hank greenberg? there are many reasons why.s from inside the company. they were not going to join this lawsuit earlier today. it was, it is so obvious. aig right now is applying to be about is known as a sieve if i firm. ive if i firm. system i financially important firm. systemmally important financial institution they are applying for that. guess who you don't sue. ashley: the federal government. >> this was a nonstarter from the minute they looked eight. should also point out another reason why, they have an ad campaign where they basically talk about how they're thanking the american tax pay fore --. ashley: turning around and suing the taxpayers essentially. >> those two things. systematically important issue made it dead on arrival. why are they taking it up? what they're saying internally and what they told me as we were reporting this out this morning this is perfunctory. hank greenberg is suing federal government over the terms he didn't like of the bailout. he is came to the board with a proposal. we have to consider

this is really -- >> is this personal for hank greenberg, you think? >> it might be. i can't say because i don't know his motivation. he's a good business man. he likes to make money and he feels he got shafted here. as do many other shareholders. the federal government, by the way, will make out pretty well here because the stock has gone up in value. it is interesting that the federal government may be the one institution more than any that comes out smelling like a rose here. >> steven moore, thank you, sir. good to see you. >> great to see you, brooke. >>> just into us here at cnn, a major decision about your privacy. we're talking about the new york police department's stop and frisk policy. today, a judge ruling the parts of it are unconstitutional. want to bring in sunny hostin in new york. sunny, there is a personal story here at the center of the whole thing that this woman and her three sons, they say they have been stopped outside their privately owned apartment building for no reason. >> that's right. and that was the basis of this lawsuit. the judge felt

hank greenberg who is the c.e.o. who's the sort of chess player behind this lawsuit so yeah i worked. for a few years and got along quite well there actually so what's your initial reaction of the story. first of all this goes back to a suit that greenberg filed about a year ago because he was forced to step down by eliot spitzer over some allegation accounting allegations but he filed he still owns a lot of stock and he filed a lawsuit about a year ago and my first reaction was i just couldn't stop laughing because here is you know one of the toughest guys described as the meanest boss of in america by forbes magazine i think any filed a lawsuit that said that the government and the federal reserve use this as an opportunity to bail out their friends on wall street like goldman sachs so my first reaction was to laugh and say oh hanks join the ninety nine percent now but what he's done is actually very shrewd because he's place the board of a i j in a very difficult position where if they don't consider joining and h

hank greenberg. >> i'm going to be on herbalife in about 30 minutes, too. >> a lot of greenbergs. >> should not have gone bankrupt. the issue is whether, when the government makes one of these loans, it seine titled to take over the equity of the company. and that's what the court in washington has held the government's not entitled to do. remember the government has admitted that this loan was fully secured. the government said so at the time, and the government has admitted in this lawsuit that the loan was fully secured. the taxpayers were never at risk. in addition, the initial interest rate was an eye-popping 14.5%. the highest interest rate the government has ever changed anybody for a loan. >> it's also the most money the government has ever given anyone for a loan. >> it is. it is. and as a result they got a very high interest rate, and they got a huge amount of security. that is the security matched the amount of the loan. more than matched the amount of the loan, as the government has repeatedly said. >> david, i won't argue your legal theory because you lay out a very stro

the lawsuit hank greenberg -- >> they said that many times. >> 14.5%. of people watching might say all right, if i didn't know it was aig and it was me i would think that was a loan shark rate but just looking at the effective rate at that time to even borrow money for companies rated poorly but not horribly, companies in better shape than aig, they were borrowing at 18%. the way i see it is 14.5% was a steal. what do you mean, you didn't get just compensation? >> i'm a taxpayer, too, and i didn't like bailouts. i didn't like this one. it certainly smells bad. it certainly seems ungrateful to taxpayers that there's this lawsuit. but let's look at what they're basically alleging. the shareholders are saying look, we weren't actually -- we might have come out better in bankruptcy if we had gone through a formal bankruptcy hearing, our shares might have been worth more than they were in this case, and that they never really actually got to vote on this because the government took over 80% control of the organization. so that's the allegation, that sharehol

they will not join hank greenberg starr international $25 billion lawsuit against the u.s.nment. this is a quote from aig, the board of directors properly executed our obligations to aig and its shareholders. the end result, aig not suing the u.s. government for the $100 billion bailout package it received. nicole: i wanted to take a look at herbalife. it has had headline after headline. the stock has gotten as high as 4190 today. we found out that hedge fund managers have been battling this one. they had an 8.2% pass at stake. that pushed the stock soaring today. it hit the circuit breaker. it was halted for a moment. it is certainly back and forth. this is a stock we will continue to follow. up 1.3% right now. back to you. liz: okay. thank you very much, though: petallides. we have moved into the central part of the hall. you have not heard about i heart radio. by the way, pandora, a lot of people talking about internet radio. this guy, bob pittman, the ceo of i heart radio joining us. you are now in lots of vehicles, are you not? >> our radio stations are in every vehicl

the shareholders said too fine but hank greenberg waited to decide whether he would join, saying, wait? >> greenberg was leaving the circus. he wanted $25 billion. >> shep: $25 billion? >> $25 billion because he says the government violated the constitution, the second amendment to avert the crisis for aig, i guess. remember that the government bailed out aig, aig has now paid that loan back as of last month and even putting up ads how great this is. the aig board, he has prevailed there, they refused his demand in its entirety. they will not be a part of the lawsuit. if greenberg goes ahead, he will have to do it on his own. he a major shareholder. remember that greenberg i believe is 85 years old. he used to run the company. he believes that the government rescued the entire financial system by bailing out aig. because of that the company was abused and misused for government purposes and that is illegal under the constitution. you are forecast at me but this is their point. >> shep: had the government not bailed the company out the company would have collapsed and financial system m

hank greenberg knows how to complain, and vociferously. the new york fed itself said that, you know what the option to this was? you go bankrupt. >> that is exactly what the new york fed said. there is no merit to the allegations. but, you know what, the interesting sidebar to this was what hank has been saying since 2011 when he filed these lawsuits. his investment vehicle, look, the problem is that aig was used as up -- there is a response. he is saying, wait a second. used as a backdoor bailouts for goldman, a deutsche bank, and general. it is an interesting position to take because what happened was, your member in that dark days of september 2008 when a add g collapsed. the thinking was of the treasury secretary tim geithner said if aig folded, collapsed, the world economy would bein dire straits. the u.s. economy would be in dire straits, and the retirements would direct. it needed to bailout. and what happened was, behind the scenes, yes tall wall street firms, lot of money out of aig to settle derivative contracts. by the way, erot

those folks at home are foggy on now. >> think of it this way, hank greenberg had a lot of shares inwhen the company imploded the value of his shares went to virtually nothing. when the government restored t the value was resuscitated. what he is saying is, my goodness, if you had given better terms, my shares would be worth more. he is wrong because his shares would have been worth less. he is now really saying, i want more back from the government beyond the assistance you gave me. somehow, i have a fiduciary duty, the board has to do it. to join me to get more money back. it's perverse logic because their value would have gone to zero if the government had not come in to safe them in the first place. >> a good point. they lost money on this. imagine where they would be if there had been no action. >> they would have gone to zero. the company would have been bankrupt. the harm to the economy would have been greater than it was because, let's not forget adg was at the center of the web of all of the financing structures the credit default swaps, akronims we heard so much about back

>> well, it's some corporate lawyer's dream fantasy along with hank greenberg's fantasy that perhaps 'll make money out of this. but it really has no basis in law or fact. >> why is greenberg doing this? just a grudge? >> well, he lost a tremendous amount of money when aig got diluted down by the government's ownership, okay. he still got hundreds of millions of dollars in his pocket. but he lost probably several billion and he is pissed out about it if i may use that word there is no basis of this board considering even for a second joining this lawsuit. >> senator liz warren of massachusetts today said aig continues to profit from a stealth bailout in the form of tax loopholes. what is your reaction to that? >> i think elizabeth warren is absolutely right about that. i mean, aig has benefitted from income tax repayments that it's been able to get from the government as a result of the bailout, avoiding future taxes. again, the choice for shareholders when they made this loan, when they accepted this loan, was either bankruptcy and getting wiped out, or live to fight another day. and

. >> this is a longstanding dispute between the former ceo of aig, hank greenberg, and the governmentyou actually read greenberg's sue, there are some points that have a little validity. it is a preposterous that greenberg, who in a way was, like a patient zero of the financial crisis because the scandal he started at aig back in the early 2000's, where he was artificially inflating the balance sheet of aig, that led to a downgrade of aig which led to the catastrophe of 2008 when the company employed it. that subsequently caused the entire financial crisis. you can really point to hank greenberg as maybe the guy who cause the financial crisis and here he is suing the american government over the bailout. one thing he says in the lawsuits, the bailout of aig was not really a bailout of aig but the companies that were owed money by aig because they give 100 cents on the dollars to all of the counterparties aig bac goldman sachs and deutsche bank and barclays. and if he were in a position, he would have negotiated a much tougher deal. that is probably true. there is some validity to that

the suit is led by former aig ceo hank greenberg, who believes the company was coereced into taking the loan. "i think they'll back off of it. there's no basis for it, and aig wouldn't survive the storm that would come from the pr disaster that would bring aig." that was hugh totten, an attorney with valorem group. aig's bailout ended with taxpayers earning $22 billion in profits. there is no comment from the white house. the future of sears rests in the hands of brazen billionaire eddie lampert. lampert runs a hedge fund, is the chairman of sears, and will now become the 5th ceo of sears in the past 7 years. analysts are wondering if lampert can provide the fix needed to put the retailer back on track. "i think the important next step is that the economy has got to improve and the merchandise has to get that much better. if that happens, then the digital stuff is great, but it needs a lot more time before it moves the needle along in terms of cash flow for the company." that was paul swinand of morningstar. lampert was the man behind the 2005 merger of sears and kmart. sears stock has

. >> and after the bell, can't miss exclusive intervows with former aig ceo hank greenberg here with his side of the lawsuit against the government and then mr. gloom and doom coming up here on this side of the rally. back in a moment. with fidelity's new options platform, we've completely integrated every step of the process, making it easier to try filters and strategies... to get a list of equity options... evaluate them with our p&l calculator... and execute faster with our more intuitive trade ticket. i'm greg stevens and i helped create fidelity's options platform. it's one more innovative reason serious investors are choosing fidelity. now get 200 free trades when you open an account. [ male announcer ] you are a business pro. executor of efficiency. you can spot an amateur from a mile away... while going shoeless and metal-free in seconds. and you...rent from national. because only national lets you choose any car in the aisle...and go. you can even take a full-size or above, and still pay the mid-size price. now this...will work. [ male announcer ] just like you, business pr

it's the former ceo hank greenberg.rom a pr point of view, the different signals, the dissonance is extraordinary. >> it is separate from the company so far. if there's going to be an alliance between the two, now it's into the existeding board accepts the view that greenberg, that aig was basically screwed by what happened with the taxpayer. but this will be a long one. we won't see any results on this paper this year. >> yeah. absolutely. but to claim right at the time when they're trying to alter talk by how much they benefited. for more on that story, head to our website, cnbc.com. >> it's getting a lot of read. don't miss out. turning our attention to yum brands, it fell more than expected in the fourth quarter. pizza hut and kfc cite bad publicity from the government based on its chicken supply. the company found its full year earnings forecast below analyst estimates. >>> now, espionage and intrigue on the high sees. oracle america's cup team is guilty of spying on italy's lun na rossa team. spying is apparently

. >> this is former ceo hank greenberg is pitching aig to join the suit. greenberg was ousted by the company in 2005. >> the company is running thank you ad campaigns right now. >> he's the one who brought the suit. he's trying to get them to sign on to it. by the way, to put some context around it, i think there was maybe a 1% or 2% chance before this article came out that the board was ever even -- now i think there's a zero percent chance. but i think the chances before the article, after the article were next to nothing, anyway. >> and you could say that they have to do this because of fiduciary reasons or of all things. >> the worst thing that could happen is that hank greenberg pursues the lawsuit on his own and hank greenberg actually wins. >> didn't a judge already throw out this lawsuit? >> it was thrown out in new york. so it creates this backwards bizarre situation. having said that, i think running the ads saying thank you, america, and trying to move ahead with a suit, i think it's crazy. >> just the idea that you would say thank you or we're

with we heard hank greenberg would sue the government and then the shea said we will not be involved.is your thoughts? >> when i saw the headline i thought it was a satire peace. we must ensure that they never bailout again. we may have lost an opportunity. >> about the ag current board? >> with old fifth amendment seizure. >> they could say we do not want that environment. lori: we appreciate your insight. much more with the jack lew nomination with the the "a team". >> state of emergency new york city lights the flu outbreak. the scary numbers are ahead. florida has its own plan to deal with the snakes. the python challenge. wildly popular created by the $1 billion industry better graphically violent video games making america a violent society? dr. keith tableau. next. ♪ [ male announcer ] how could a luminous protein in jellyfish, impact life expectancy in the u.s., real estate in hong kong, and the optics industry in germany? at t. rowe price, we understand the connections of a complex, global economy. it's just one reason over 75% of our mutual funds beat their 10-year lipper av