Scandal-hit Olympus Corp is suing 19 of its serving and former executives for a total of $50 million (£32 million) for alleged mismanagement.
Olympus, which makes camera and medical equipment, is embroiled in allegations of fraud after it emerged that almost $2 billion was paid to hide information on offshore companies it used for consultancy work.
The company has admitted it used the bloated consultancy fees to mask huge losses.
Its share price plunged in the wake of the scandal, with the company losing nearly 60 percent of its value since October.
Now Olympus is trying to purge itself of those responsible for its recent problems.
Current president Shuichi Takayama and five other board members, who are all due to leave the company by April, are among those being sued.
"The plan is for the current board members who were found responsible and are subject to lawsuits to complete passing on their roles to avoid any impact on business implementation, and all resign at an extraordinary shareholders' meeting to be held in March or April 2012," the company said in a statement.
Some analysts believe the move leaves Olympus open to a takeover.
"Essentially, everyone feels they are on death row. It does seem extremely strange to have the death-row cell inside the company," Nicholas Smith, head of Japanese equity strategy at CLSA in Tokyo, told Reuters.
"Having nobody at the helm makes it easier for a takeover."
Olympus' former British chief executive, Michael Woodford, was ousted after blowing the whistle on the dodgy accounting.
He has since revealed he is suing Olympus and has made a bid to be re-hired as the company's head.
Japanese police, along with British, US and Japanese regulators, are investigating the company books.
Following the announcement of legal action against executives, Olympus' share price rallied by almost 30 percent.