## Facts

- During the 2008 financial crisis, American International Group, Inc. (AIG) faced an acute liquidity crisis.
- Starr International Company, Inc. (Starr), a significant AIG shareholder, alleged the United States used AIG’s distress to obtain control as both lender and shareholder, including a 79.9% equity interest.
- Starr alleged the government used AIG to support other financial institutions and, in doing so, took AIG’s property, including hundreds of millions of AIG common shares and related control rights, without just compensation.
- Starr sued in the Court of Federal Claims seeking monetary relief and asserted both direct shareholder claims and derivative claims on AIG’s behalf.
- The United States moved to dismiss under RCFC 12(b)(1) and 12(b)(6), arguing, among other things, lack of jurisdiction under 28 U.S.C. § 1500, lack of standing, and failure to state cognizable Tucker Act claims.

## Issues

1. Whether 28 U.S.C. § 1500 deprived the Court of Federal Claims of jurisdiction due to related litigation pending in another court.
2. Whether Starr had standing to assert direct shareholder claims and derivative claims on behalf of AIG at the pleading stage.
3. Whether the complaint plausibly stated Fifth Amendment takings and illegal-exaction claims within the Tucker Act’s jurisdiction.
4. Whether equal protection, due process, and unconstitutional-conditions theories could support monetary relief in the Court of Federal Claims.

## Decision

- The court granted the motion to dismiss in part and denied it in part.
- The court rejected the government’s § 1500 jurisdictional challenge, holding the Court of Federal Claims could proceed because the other litigation was not the same claim for § 1500 purposes.
- The court held Starr plausibly alleged standing to proceed, including derivative standing based on demand futility allegations, and allowed at least some direct theories to continue.
- The court denied dismissal of the core takings and illegal-exaction claims, finding the alleged coercive transfer of equity and control rights sufficiently pleaded to proceed past RCFC 12.
- The court narrowed or dismissed aspects of equal protection and due process claims to the extent they did not supply a money-mandating basis for relief, while permitting related theories to continue only insofar as they connected to the takings/illegal-exaction framework.
- The court allowed an unconstitutional-conditions theory to proceed in a limited manner as tied to the alleged compelled surrender of property and control in exchange for emergency assistance.

## Legal Principles

- 28 U.S.C. § 1500 bars Court of Federal Claims jurisdiction only when another suit is pending based on the same operative facts and seeking the same relief; differing relief can defeat the bar.
- Shareholder harms may be derivative when they flow from injury to the corporation, but a plaintiff may proceed derivatively at the pleading stage when demand futility is adequately alleged.
- A Fifth Amendment takings claim may proceed when a plaintiff plausibly alleges government action, for a public purpose, resulting in compelled transfer of property without just compensation; voluntariness and coercion questions may be unsuitable for resolution on a Rule 12 record.
- An illegal-exaction claim lies when the government is alleged to have obtained and retained money or property without lawful authority.
- Equal protection and substantive due process theories generally do not provide an independent money-mandating basis for Tucker Act damages; such allegations may survive only insofar as they support a cognizable takings or illegal-exaction claim.

## Conclusion

The court’s threshold ruling allowed substantial portions of the AIG-bailout challenge to move forward by finding jurisdiction not barred by § 1500, recognizing plausible direct and derivative standing at the pleading stage, and holding that takings and illegal-exaction theories were sufficiently stated, while trimming constitutional claims lacking a money-mandating basis for damages.


Starr Int'l Co. v. United States, 106 Fed. Cl. 50 (2012)