American International Group shareholders hoping to hold executives at the firm responsible for the insurer’s near-collapse were told they did not have a case yesterday.

A Manhattan federal judge dismissed the shareholder lawsuit, which accused current and former AIG executives and directors of ignoring "red flags,'' that caused the insurer's financial failures and resulted in $180 billion of federal bailouts. The suit accused AIG officials of disregarding the potential for catastrophic losses stemming from exposure to credit default swaps.

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