Mitchell v. Franchise Tax Board

Harry and June Mitchell (“Mitchells”) filed ■ an adversary complaint in their bankruptcy case against the California Franchise Tax Board (“FTB”) and the California Board of Equalization (“Board”) (together, the “State”) to determine the amount and dischargeability of taxes owed to the State. The Mitchells also asserted state and federal claims, alleging, inter alia, violations of the Fourteenth Amendment. The Mitchells appeal the Bankruptcy Appellate Panel’s (“BAP”) affir-mance of the bankruptcy court’s dismissal of all claims for lack of jurisdiction on the basis of state sovereign immunity under the Eleventh Amendment of the United States Constitution. We have jurisdiction over this appeal pursuant to 28 U.S.C. § 158 (d) and affirm the decision of the BAP.

*1115 I.

The Mitchells filed a voluntary Chapter 7 bankruptcy petition in bankruptcy court in late 1995. The Mitchells listed the FTB as one of their creditors to whom they owed approximately $300,000 in state income taxes and interest. The FTB did not file a proof of claim in the Mitchells’ bankruptcy proceedings. In February 1996, the bankruptcy court issued a general discharge order as to all pre-petition debts.

In March…