All four men arrested in connection with the bombing in the Co Derry village of Claudy in 1972 were released last night without charge.
The PSNI said a report was being prepared for the Public Prosecution Service.
The four included Sinn Féin East Derry assembly member Francie Brolly.
Sinn Féin's Mitchel McLaughlin described Mr Brolly's arrest as "yet another clumsy political stunt by the Special Branch to try and damage Sinn Féin and the wider peace process".