Two pieces of news provide a flicker of hope amid the doom and gloom.
Ex-CEO's company suing over bailout
WASHINGTON - A company run by the former CEO of American International Group Inc. is suing the government for $25 billion in damages over its taxpayer bailout of the big insurer.
Former AIG CEO Maurice "Hank" Greenberg's current company - Starr International - filed lawsuits Monday in federal courts against the Treasury Department and the Federal Reserve Bank of New York. The suits accuse the government of taking valuable assets from AIG's shareholders without their consent or fair compensation, in exchange for the government's 80 percent stake in the company. The suit says the government's actions violate parts of the Fifth Amendment.
to buy Pharmasset
INDIANAPOLIS - HIV drugmaker Gilead Sciences Inc. will spend about $11 billion to buy Pharmasset Inc. in what one analyst termed an "amazing risk," a high stakes gamble that could yield billions of dollars in drug sales if a possible groundbreaking hepatitis C treatment pans out.
Gilead said Monday it will pay $137 per share in cash for Pharmasset, a Princeton, N.J., company with no products on the market and a stock that has traded as low as $20.49 in the past year.
Analysts see promise in Pharmasset's lead candidate, a pill labeled PSI-7977 that has just started late-stage testing. They say it could become a preferred option for care if it works without the injectable drug interferon, which can leave patients with flu-like symptoms that last for months.
Alleghany to buy Transatlantic
BOSTON - Transatlantic Holdings Inc. agreed Monday to be acquired by property and casualty insurer Alleghany Corp. in a $3.4 billion deal after months of jockeying for the reinsurer.
Transatlantic announced in June that it agreed to combine with Switzerland-based Allied World Assurance Co. Holdings AG. While that transaction was pending, others stepped in with takeover bids for Transatlantic, including Validus Holdings Ltd. and a unit of Warren Buffett'sBerkshire Hathaway Inc., National Indemnity Corp.
Transatlantic and Allied World called off their deal in mid- September, without specifying a reason for what they described as a mutual decision.
Man pleas guilty
in $670 million scam
RICHMOND, Va. - A man who cooked the books for a $670 million insurance industry scam pleaded guilty Monday to charges he helped mislead thousands of investors worldwide.
Jorge Luis Castillo, 56, of Hackettstown, N.J., entered pleas in U.S. District Court to conspiring to commit mail and wire fraud in U.S. District Court. He is scheduled for sentencing May 22 and could receive up to 20 years in prison and be fined up to $250,000.
Castillo will assist the government's prosecution of Minor Vargas Calvo, 60, the president and majority owner of Provident Capital Indemnity Ltd., a Costa Rican company.
Calvo is scheduled for trial in February. He has pleaded not guilty to similar charges.
sales rise 1.4%
WASHINGTON - The number of Americans who bought previously occupied homes rose slightly last month but remained at depressed levels. And more deals are being canceled at the last minute, a sign that even those who are looking to buy are worried about the housing market.
Sales rose 1.4 percent last month to a seasonally adjusted 4.97 million.