NEW YORK (Bloomberg) — American International Group Inc., the world's biggest insurer, has taken control of a lawsuit filed by shareholders on behalf of the company against former chief executive officer Maurice "Hank" Greenberg.The amended complaint, filed this week in Delaware Chancery Court, names AIG as the plaintiff and blames Greenberg and former AIG chief financial officer Howard Smith for a $3.4 billion restatement of earnings after AIG was sued in 2005.

In some cases, shareholders can pursue claims against executives on behalf of a corporation. The company is then required to a form a committee to review the complaint and decide if it will pursue the case.

AIG, which had until yesterday to decide, chose to press forward.

Greenberg's lawyer Lee Wolosky said the suit includes several old allegations that were dropped by then-New York Attorney General Eliot Spitzer last year.

Directors of AIG decided it was in the "best interests of AIG and its shareholders for AIG to pursue these claims against Messrs. Greenberg and Smith, rather than have them controlled by the plaintiffs bar", company spokesman Chris Winans said in a statement.

The legal action came one day after Greenberg, who was forced to retire from AIG in March 2005 two months before being sued by Spitzer, filed a memorandum in a separate case in New York state court that blamed AIG's current management for harming shareholders by restating earnings. "This is a special AIG litigation committee that had been looking at this for many months," Wolosky said in a phone interview. "For them not to come up with any new allegations was telling."

"There were no wrongdoings by Greenberg," Wolosky said.

The complaint filed in New Castle, Delaware, stems from several shareholder suits filed in 2004 after Spitzer said AIG was involved in bid-rigging with broker Marsh & McLennan Cos., Winans said.

The suits were later combined and updated to include allegations made by Spitzer and federal authorities in 2005 that Greenberg was involved in improper transactions to inflate reserves and hide underwriting losses. New York-based AIG paid $1.64 billion last year to settle the state and federal probes.