The Office of the U.S. Trustee has objected to a plan presented in bankruptcy court by the Borders Group to give out over $8 million is bonuses to its executives. (See the earlier MobyLives report.)

Calling it a “disguised retention plan for insiders,” the Trustee’s Office (“the Justice Department agency charged with overseeing the administration of bankruptcy cases”), in a filing made by trustee Tracy Hope Davis, said that “Seeking the approval of the bonus motion at this early juncture, prior to the debtors’ finalizing their business and operational plans is not a sound exercise of the debtors’ business judgment,” according to a Wall Street Journal report.

According to WSJ reporter Joseph Checkler, Borders had also failed to provide the “names, positions, and reporting relationships” of everyone covered by the bonus plan.

According to a Reuters wire story, Borders released a statement in response saying, “Borders has made significant progress during the first six weeks of its reorganization. Retaining key executives is essential to continuing the progress underway for the benefit of all of the company’s stakeholders.”

But most publishers are likely to see that defense as throwing more fuel on the fire. In fact, as an earlier New York Times report by Julie Bosman noted, the huge bonus plan in the face of bankruptcy is one reason many publishers — aka creditors who are owed tens of millions of dollars — feel the Borders execs who would be getting those bonuses don’t know what they’re doing.