The plan worked out last month by American casino giant Caesars Entertainment Corporation designed to get its Caesars Entertainment Operating Company Incorporated subordinate out of a contentious two-year bankruptcy could reportedly be in jeopardy following a ruling from the federal government’s watchdog.

According to a report from the Reuters news service, Caesars Entertainment Operating Company Incorporated filed for Chapter 11 bankruptcy protections in January of 2015 with debts of $18 billion while creditors subsequently alleged that Caesars Entertainment Corporation and its private equity backers, Apollo Global Management and TPG Capital Management, had looted the unit prior to declaring insolvency.

After numerous legal wrangles, a deal was finally signed in October that would see Caesars Entertainment Operating Company Incorporated split into a casino operator and real estate investment trust with both controlled by creditors. Las Vegas-based Caesars Entertainment Corporation, which is responsible for such properties as the Rio All Suite Las Vegas Hotel And Casino, Bally’s Atlantic City Hotel And Casino and Caesars Windsor Hotel And Casino, agreed to contribute some $5 billion to the reorganization plan in exchange for being released from billions of dollars in potential legal claims.

Caesars Entertainment Corporation previously revealed that it intends to raise the $5 billion by giving investors stock in a new group it wants to create by merging with its Caesars Acquisition Company affiliate, which in July agreed to sell its Caesars Interactive Entertainment online games unit for $4.4 billion in cash.

However, Reuters reported that the United States Trustee Program overseer has now objected to the “blanket immunity” releases and the exculpation of “a wide array of parties for acts far beyond the plan or the Chapter 11 cases”.

The United States Trustee Program, which supervises the administration of bankruptcy cases, also criticized the legal releases as too broad for shielding against willful misconduct or actual fraud.

A report from an independent examiner in March found that Caesars Entertainment Corporation as well as Apollo Global Management and TPG Capital Management could be on the hook for up to $5.1 billion in damages for the alleged asset-stripping although all three have continually denied any wrongdoing.

Reuters reported that the plan is due to go before the United States Bankruptcy Court for approval in January but the objections of the United States Trustee Program could see any positive decision subsequently appealed to a higher court.

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