The federal lawsuit, filed in Los Angeles on Tuesday, accuses the network of violating the band's free-speech rights and hurting its record sales by barring it from NBC shows to placate the Federal Communications Commission. The suit seeks a court order lifting the ban as well as unspecified damages.
Neil used the f-word during the live New Year's Eve broadcast as he yelled a greeting to bandmate Tommy Lee shortly after midnight.
Though carried live on the East Coast, the remark was excised in other time zones. Neil was unaware his statement was aired live, according to the lawsuit. The FCC said it received complaints about the broadcast.
The lawsuit accuses NBC of singling out the group, saying network officials stopped short of banning other artists who swore on-air, including U2 frontman Bono, who used the same expletive at last year's Golden Globe Awards.
"This is about fair and equal treatment. We have a right to be treated in the same way as other artists who have made the same mistake," bassist Nikki Sixx said in a statement.
The network dismissed the lawsuit as meritless.
"To ensure compliance with its broadcast standards, NBC has the right to decide not to invite back guests who violate those standards and use an expletive during a live entertainment program," the company said in statement. "We will defend the case vigorously and we fully expect to prevail."
The 1980's glam band, known for its hard partying and wild sexcapades, recently reunited after a five-year hiatus.
The group claims a planned appearance on NBC's "Last Call With Carson Daly" was canceled, while it was prohibited from other network programs. That allegedly cost it media exposure that weakened ticket, merchandise and album sales, the suit claims.
The lawsuit questions why NBC announced that Lee would appear individually in an upcoming television reality show despite the ban, contending the network censored the group as a whole to mollify federal officials so it would avoid sanctions against its business.