American International Group, the insurance group that federal loans of $85 billion rescued in September has agreed to a personal injury settlement of $18 million with the father of a disabled man formerly from Raleigh.

The decision of AIG to conclude the settlement with the father of 29-year-old accident victim Mark Pellegrin comes after the company was ordered by a judge to pay $75 million when a subsidiary failed to defend the case in Wake Superior Court.

Such settlements typically do not become public, but the details were discussed in early October in an open court session before U.S. District Judge Terrance Boyle attended by a reporter for the News & Observer of Raleigh. Attorneys for both sides asked that the settlement be kept confidential, but their request was not taken up by Boyle.

Attorneys also said that they were moving quickly to settle due to AIG’s financial condition. In September, the company was rescued by the Federal Reserve with a two-year, $85 billion credit line in return for a 79.9 percent stake in the company.

According to local attorneys, the settlement seems to be one of the largest in North Carolina history for a personal injury case.

In May, state Superior Court Judge Orlando Hudson granted a request by Pellegrin’s attorneys to order AIG to pay damages of $75 million. No representation for National Union Fire Insurance Co., a Pittsburgh, Pennsylvania subsidiary of AIG, showed up at the trial to defend the company that owned the pickup truck involved in the incident and the employee driving it.

National Union asked for the case to be taken up for the federal court while at the same time, the company began settlement talks with Pellegrin’s attorneys.

The initial suit was filed a year ago against KCI Technologies and 29-year-old KCI employee Kelly Joe McKiernan, who maintained the company’s cell phone towers. In a deposition, McKiernan said that he had been drinking beer and Jagermeister on New Year’s Eve 2005 before jumping into his company-issued truck. He was ready to leave Pellegrin’s apartments after some roughhousing between the two friends left McKiernan upset.

As McKiernan put the truck into gear, Pellegrin ran in front of it in an attempt to get him to stop. But the truck struck Pellegrin, who sustained severe injuries to his brain which left him with limited movement and speech.

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