[JURIST] Leading Monday's corporations and securities law news, insurance giant American International Group (AIG) [corporate website] announced it has received subpoenas from New York Attorney General Eliot Spitzer [official website] and the SEC [official website] "relating to investigations of nontraditional insurance products and certain assumed reinsurance transactions and AIG's accounting for such transactions." AIG said it will cooperate with the probe. Spitzer, who has accused the insurance industry of extensive bid-rigging and price fixing, has in recent weeks broadened his investigation into non-traditional insurance products in an attempt to determine whether they are aimed at reducing risk or vehicles to help companies smooth earnings. Just last month, Spitzer and the SEC sent subpoenas to billionaire investor Warren Buffett's Berkshire Hathaway Inc. seeking information from its reinsurance subsidiary, General Re Corp [corporate website]. Read the AIG press release. AP has more.

In other news…

• The House Financial Services subcommittee [official website] is scheduled to hold a hearing [House press release] Tuesday about a SEC proposal, called Regulation NMS [Text of SEC proposed rule], which would reform stock trading rules in an effort to modernized the markets. The new rules could potentially hurt the auction system at the NYSE. CBSMarketWatch has more.
• Verizon Communications Inc. [corporate website] announced it would buy long-distance telephone company MCI Communications Inc. [corporate website] in a deal worth $6.75 billion. The deal will provide Verizon with an opportunity to compete with SBC Communications [corporate website] which recently acquired AT&T Corp [SBC information website]. Verizon, which beat out rival Qwest Communications [corporate website], will exchange stock valued at $4.8 billion and $488 million in cash to acquire MCI. Read the Verizon press release. Reuters has more.
• General Motors (GM) [corporate website] will pay Fiat [corporate website] $2 billion under a deal that releases the auto giant from an obligation to buy Fiat's car unit. The deal dissolves a 2000 partnership pact between the automakers which included an option for GM to buy the 90 percent of Fiat Auto that it did not already own. AP has more.
• OfficeMax Inc. [corporate website] has announced the resignation its CEO Christopher C. Milliken and also the firing of two employees connected with the ongoing internal investigation into the company's accounting. Read the OfficeMax press release. AP has more.
• As previously reported on JURIST's Paper Chase, the Pentagon [official website] announced it is investigating an additional eight weapons contracts handled by former Air Force acquisitions official Darleen Druyun for possible abuses. Four of the deals are with Boeing, the company to which Druyun gave special influence [JURIST story]. Read the DOD press release announcing the investigations and a list of contracts under review [PDF]. AP has more.
• The FTC [official website] is looking into Blockbuster Inc.'s [corporate website] hostile bid to acquire Hollywood Entertainment Corp. over potential antitrust violations. Read the Blockbuster press release relating to the bid. Reuters has more.

Click for previous corporations and securities law news.