NEW YORK—Two former Marsh Inc. executives whose bid-rigging convictions have been overturned have accused their former employer of violating federal law and breach of contract.

In a lawsuit filed last week in the U.S. District Court for the Southern District of New York against Marsh, parent company Marsh & McLennan Cos. Inc. and two other MMC units, William M. Gilman and Edward J. McNenney Jr. said Marsh fired them without cause in late 2004, shortly after then-New York Attorney General Eliot Spitzer filed a complaint against Marsh regarding contingent commissions.

Both men served as managing directors of Marsh.

The men allege Marsh did not pay them the severance to which they were contractually entitled. They also allege they were not paid stock bonuses to which they were entitled under the parent company's stock award plan. They allege the brokerage's actions in regard to the severance pay and the stock bonuses violated the federal Employee Retirement Income Security Act.

Both men were indicted in 2005 on 37 counts regarding alleged bid-rigging. Before that, MMC settled New York state's civil suit regarding contingent commissions for $850 million.

Messrs. Gilman and McNenney each were found guilty in February 2008 on a single count of restraint of trade and competition. But last summer, New York County Supreme Court Judge James A. Yates overturned the convictions of both men, citing new evidence that “undermines the court's confidence in the verdict” (BI, July 12).

The evidence included undisclosed documents that would have been “invaluable” to the defense and contradictory statements by witnesses who cooperated with prosecutors, the judge ruled.

In their suit, Messrs. Gilman and McNenney hold that they did “not commit any inappropriate or illegal actions” while employed by Marsh. They also hold that other Marsh employees who were terminated as result of the Spitzer investigations received severance payments.

The suit alleges that the refusal to pay them severance and bonuses was “arbitrary and capricious” under ERISA. Among other things, they also allege breach of contract and unjust enrichment.

The suit does not specify the amount of damages sought.

An attorney representing the plaintiffs was not immediately available for comment.

MMC declined to discuss the case. “We have no comment on this matter at this time,” said an MMC spokeswoman in an e-mail.