California Tax Agency Wants SunPower Dispute Out of Bankruptcy

A California agency asked a bankruptcy court to abstain from hearing a tax liability dispute with SunPower Corp., instead requesting that a specialized state forum handle the appeal over a multiyear-audit involving more than $13 million in alleged underpayments.

State experts, rather than bankruptcy judges, should handle a nonbankruptcy dispute over a state tax audit, especially when necessary records are absent, the California Department of Tax and Fee Administration said in a Wednesday filing in the US Bankruptcy Court for the District of Delaware.

A judge can abstain from handling a tax liability claim dispute under a bankruptcy law provision, ...