MONTREAL—The U.S. government has asked a bankruptcy judge to deny Quebecor World’s restructuring plan because of millions owed in unpaid taxes, and environmental fines.

In a court motion filed yesterday in a New York bankruptcy court, the U.S. government said the plan lets a range of third parties off the hook for US$10 million in unpaid corporate taxes, and US$150 million in penalties related to environmental law violations.

According to the Globe and Mail, the U.S. argues that proposed third-party releases aren’t crucial to the plan, and that bankruptcy court lacks the authority to free them from liability, because the court doesn’t have the jurisdiction to override laws involving taxes or claims in other courts of law.

On Tuesday, creditors in both Canada and the U.S. voted in favour of the plan, and a new board was announced.

Next up for Quebecor World is a U.S. bankruptcy court hearing in the Southern District of New York set for June 30, where the company will look to get approbation (approval). After that, the company expects to emerge from bankruptcy protection in mid-July.