Domenech's lawyer, Jean-Yves Connesson, told AFP: "We are requesting 2.9 million euros spread over two payments.
"The first is for 400,000 euros and includes compensation for dismissal. The second is for professional and moral prejudice and is worth three years salary,"
He added: "You don't manage a collective crisis by sacking one individual. An amicable parting of ways was a possibility.
"The federation came up with totally unfounded reasons for the sacking, and went through with it in an irregular, brutal and aggressive manner."
Domenech lost his job after France failed to qualify from the group stages in South Africa, amid player unrest that saw his squad boycott a training session.
However, Connesson believes his client has a good chance of winning his case. He told AFP: "We can't forget Domenech is the only coach to have qualified France for three consecutive major international tournaments (two World Cups and one European Championships).
"And we sack him for a serious error! Those are not valid reasons and we want to prove that in front of a judge.
"It is difficult for him to bounce back. Stained by the accusations of serious error means that 17 years of his career has been erased by the stroke of a pen."
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