Murray Energy’s Bankruptcy Plan Releases Face Challenge by U.S.

Murray Energy Corp. shouldn’t send its reorganization plan to a creditor vote without amending provisions that would shield others tied to the bankrupt coal giant from litigation, the Justice Department said.

Murray hasn’t justified the inclusion of the releases in its Chapter 11 plan, the U.S. Trustee’s office said in a filing Wednesday in the U.S. Bankruptcy Court for the Southern District of Ohio.

The materials explaining the plan also don’t provide a basis to bind creditors to those releases if they reject the plan or abstain from voting, the DOJ’s bankruptcy watchdog said.

Creditors only should be bound to ...