Fujifilm Holdings Corp. is suing Xerox Corp. for breach of contract and estimated damages of more than $1 billion after the printer and copier company walked away from a planned merger earlier this year.

Xerox reached a truce with activist investors Carl Icahn and Darwin Deason last month to terminate the deal it had in place with Fujifilm, but it is still fighting with Fujifilm over the soured merger the pair sought to prevent.

Fujifilm’s...