Justice Department Trying To Prevent Ben Bernanke From Having To Testify In AIG Bailout Lawsuit

WASHINGTON (Reuters) - The U.S. Justice Department on Friday asked an appeals court to reverse a judge's ruling last month that Federal Reserve Chairman Ben Bernanke must testify in a lawsuit about American International Group Inc's 2008 bailout.

Bernanke cannot be forced to sit for a deposition because high-ranking U.S. government officials are generally protected from being drawn into time-consuming civil litigation, the Justice Department said in its petition.
The petition was filed in the U.S. Court of Appeals for the Federal Circuit in Washington.

"The demands of civil litigation, if not appropriately limited by the courts, will impair the ability of senior government officials to lead the departments and agencies for which they are responsible," the petition said.

Parties to a lawsuit also do not have the right to depose agency officials to cross-examine the basis of their decisions, the Justice Department argued.

Former AIG chief Maurice "Hank" Greenberg's Starr International Co. is suing the U.S. government for allegedly short-changing AIG shareholders by tens of billions of dollars during the bailout.

Starr was once AIG's largest shareholder, with a 12 percent stake.

Alanna Rutherford, a lawyer for Starr, said in response to the government's filing: "It's disappointing that the government seeks to delay discovery of the facts in this important case."

(Reporting by David Ingram; Editing by Dan Grebler)