American International Group

US court: ex-AIG CEO hasn't right to challenge bailout

A federal appeals court has ruled that the former CEO of American International Group lacks the legal right to challenge the government's bailout of the insurance giant in the heat of the financial crisis.

The ruling Tuesday by the U.S. Court of Appeals for the Federal Circuit overturned a lower-court decision and handed a victory to the government.

The next stop for the case may be the Supreme Court. David Boies, the attorney for ex-AIG chief Maurice Greenberg, said they will appeal the ruling. The unusual case raised the issue of limits on the government's power in responding to financial catastrophe.

In a lawsuit filed by his company, Starr International, Greenberg...