Mickey Arthur is attempting to sue Cricket Australia for around £2.4m following his sacking as national team coach.
The 45-year-old, who took charge of the side in 2011, was replaced by Darren Lehmann at the end of June.
The South African has now started legal proceedings against Australian cricket's governing body due to alleged racial discrimination.
The court papers lodged by Arthur also claim that captain Michael Clarke and Shane Watson have a 'cancerous' relationship in the dressing room.