NEW YORK (Bloomberg) — American International Group Inc., the insurer resolving legal disputes with former chief executive officer Maurice (Hank) Greenberg, should postpone the settlement to clarify shareholder claims, a lawyer told a Delaware judge.

Stuart Grant, representing Louisiana pension funds that sued Greenberg and other AIG officials in 2004, asked Judge Leo Strine Jr. for a 10-day delay of the settlement because it may nullify his claims, according to papers made public yesterday in Delaware Chancery Court.

As the agreement is written, AIG officials sued in Delaware "could assert that the claims against them have been released," and "for no consideration", Grant wrote.

In a filing yesterday, AIG lawyer Mark Hurd told Strine that Grant is mistaken, and the agreement with Greenberg "does not extinguish the shareholder plaintiffs' claims in this action."

New York-based AIG, which has been bailed out by the US government, said on November 25 it agreed to resolve all legal disputes with Greenberg, 84, who ran the company for almost four decades, creating the world's biggest insurer.

He retired in 2005, under investigation over how the company and affiliates were managed.

AIG fell $4.67, or 14 percent, to $28.63 at 3:21 p.m. in New York Stock Exchange composite trading. The shares have fallen 8.8 percent this year.