Lagardere, a French media group, is suing media and telecom group Vivendi demanding compensation of 1.6 billion euros ($2.2 billion) in a disagreement over their Canal+ France pay-TV unit.

Vivendi is making permanent use of the business's entire cash surplus under a disputed cash management agreement between the venture and its Vivendi-owned parent, claimed Lagardere according to the Reuters reports.

Lagardere wants Vivendi to return the sum to Canal+ France.

"Lagardere considers that the use made by the Vivendi group of this cash management agreement has caused significant harm to Canal+ France," said the company in a statement. It further said that the cash pile was providing Vivendi with low-cost funding for its own goals.

But, denying the allegations made by Lagardere, Vivendi said that the cash accord did not need a permission from the supervisory board of Canal+ France.

"This is an attempt by the Lagardere Group to destabilize Vivendi and force it buy back the former's stake in Canal+ France," the statement by Vivendi said.

The Financial Times reported that Lagardere is asking the Paris Commercial Court to cancel a 2007 agreement that allows Vivendi to access Canal+ France's 1.6 billion euros cash and are demanding the return of the funds to the pay-TV joint.Previously the two companies failed to reach an agreement on the ownership of Canal+ France, which followed Lagardere suing Vivendi, reported Reuters.