The family of a slain Iraqi security guard says in a federal lawsuit that a former Blackwater contractor fatally shot the man while wandering drunk in Baghdad, and the survivors accuse the company of covering up wrongdoing while reneging on promises of compensation.

Raheem Khalaf Sa'adoon's wife and two children said Blackwater, the North Carolina-based company now known as Xe, destroyed documents to hide evidence of a pattern of recklessness. The lawsuit filed Thursday in the southern district of California also says the company promised to compensate the widow, Wijdan Mohsin Saed, in a series of payments but stopped after an initial payment of $20,000.

"She was expecting a continued stream of compensation," said Susan Burke, a Washington-based attorney for the family, in an interview. "But, obviously, with killing the breadwinner of the family, they had essentially cut off her means of livelihood. She's a stay-at-home mom and doesn't have any other source of income."

The lawsuit names both Xe and the former Blackwater guard, Andrew Moonen. It says Moonen shot Sa'adoon without provocation on Christmas Eve of 2006 after getting drunk at a party and then getting lost. Sa'adoon, 32, was on guard duty for Iraqi Vice President Adel Abdul Mahdi at the time.

A lawyer for Moonen, a Seattle resident, said in January he received a letter from federal prosecutors saying they intend to charge him in the killing. On Friday, attorney Stewart Riley said Moonen was defending himself.

"Mr. Moonen fired in self defense, ran for his life to the nearest checkpoint and reported the incident," Riley said, declining to comment further.

Xe spokeswoman Anne Tyrrell said in a release that the shooting happened while Moonen was off-duty. She said military officials investigated the matter and that the company was ordered to remove him from Iraq. He was fired and fined, and Tyrrell said the company has assisted throughout a Department of Justice investigation.

"If it is determined that he acted unlawfully, we strongly support holding him accountable," Tyrrell said.

Tyrrell said the lawsuit "is riddled with errors and is being driven by a desire for publicity." She said Xe has strict rules for preserving documents and that an outside counsel found no signs that any related to the case were destroyed.

A congressional report released in 2007 said Moonen reported the shooting at a nearby post for another security contractor, Triple Canopy, saying he had been in a gunfight with Iraqis. The lawsuit says a visibly intoxicated Moonen simply pulled out his Glock and fired at Sa'adoon for no reason.

The lawsuit accuses Xe of a pattern of recklessness and illegal activity. It seeks compensation and punitive damages that would strip the company of all "revenue and profits earned from their pattern of constant misconduct and callous disregard for human life."

"To some degree, I think they continue to believe they'll be able to evade scrutiny and accountability," Burke said.

Blackwater changed its name to Xe (pronounced ZEE) in February.

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