Bankruptcy is available to everyone. Companies, for no fault of their own, could be hit with a ridiculous amount of suits that completely wipe out their ability to operate. Individuals could be hit with a ridiculous amount of suits that can completely wipe out their ability to rebound in life. Bankruptcy is there to protect them from a run off on finances. It serves a purpose in society. It serves its purpose rather well.
In THIS SPECIFIC situation, THIS SPECIFIC organization, is PURPOSELY taking advantage of the bankruptcy laws as a way of legal insurance fraud and wealth transfer. That does NOT mean the "government" is protecting them. Your wording implies that the government is encouraging the actions of freedom industries. The organization is HIDING behind a law. Two very different ideas.
And again about the different levels of government. This is where your ideology gets exposed. According to you, the "government" (and then as you later specified - the federal government), is protecting Freedom Industries. So what happens when The State of West Virginia or the City of Charleston, West Virginia sues Freedom Industries (not that they can anymore since the organization filed for bankruptcy). If we put your ideology into an equation, it would say, "the government is suing the government with the help of the government."
Each branch, each level of government, has a responsibility to what it considers its "constituents." You fail to see, and you fail to understand, that local, state, and federal authorities are not 1 entity. They routinely sue each other. They routinely fight for authority. STATES routinely sue each other as well. So how elementary is your "it's the governments fault" ideology, when there is no singular ideology that constitutes the "Government of the United States."