"Unless systemic and drastic measures are instituted immediately, the costs to these veterans, their families and our nation will be incalculable, including broken families, a new generation of unemployed and homeless veterans, increases in drug abuse and alcoholism, and crushing burdens on the health care delivery system," the complaint says.

It asks that a federal court order the VA to make immediate improvements.

Earlier this month, a federal appeals court in San Francisco issued a strong rebuke of the VA in ordering the agency to pay retroactive benefits to Vietnam War veterans who were exposed to Agent Orange and contracted a form of leukemia.

"The performance of the United States Department of Veterans Affairs has contributed substantially to our sense of national shame," the opinion from the 9th U.S. Circuit Court of Appeals read.

Nicholson abruptly announced last week he would step down by Oct. 1 to return to the private sector. He has repeatedly defended the agency during his 2 1/2-year tenure while acknowledging there was room for improvement.

More recently, following high-profile suicide incidents in which families of veterans say the VA did not provide adequate care, Nicholson pledged to add mental health services and hire more suicide-prevention coordinators.

Some veterans say that's not enough. In the lawsuit, they note that government investigators warned as early as 2002 that the VA needed to fix its backlogged claims system and make other changes.

Yet, the lawsuit says, Nicholson and other officials still insisted on a budget in 2005 that fell $1 billion short, and they made "a mockery of the rule of law" by awarding senior officials $3.8 million in bonuses despite their role in the budget foul-up.

Today, the VA's backlog of disability payments is between 400,000 and 600,000, with delays of up to 177 days to process an initial claim and an average of 657 days to process an appeal. Several congressional committees and a presidential commission are now studying ways to improve care.

"While steps can and will be taken in the political arena, responsibility for action lies with the agency itself," Melissa W. Kasnitz, managing attorney for Disability Rights Advocates, said in a telephone interview. Her group is teaming up with a major law firm, Morrison & Foerster, to represent the veterans.

"We don't believe the problems will be fixed by the VA if we wait for them," she said.

Gordon P. Erspamer, a partner at Morrison & Foerster, stressed that the lawsuit does not seek to make a partisan statement about the Iraq war but instead finally force action after years of delay.

"This is the worst it's ever been for veterans, and it's only going to get worse," he said.

The lawsuit cites violations of the Constitution and federal law, which mandates at least two years of health care to injured veterans.

The veterans groups involved in the lawsuit are Veterans for Common Sense in Washington, D.C., which claims 11,500 members, and Veterans United for Truth, based in Santa Barbara, Calif., with 500 members.

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On the Net:

Copy of the complaint: www.mofo.com/docs/pdf/PTSD070723.pdf

Department of Veterans Affairs: www.va.gov/