Joseph R. and Jennifer L. Netzel, a Spokane couple who operate a business here that buys and sells items over the eBay Web site, have filed for Chapter 7 liquidation in U.S. Bankruptcy Court here.

Their filing documents list assets of $734,000 and debts of $2.9 million. The documents indicate their debts are primarily business related.

The largest unsecured claim listed in the documents is held by W. Daniel Tate Jr., through his Ontario, Calif.-based attorney, James Klinkert, for $2 million.

John Munding, of Spokane-based Crumb & Munding PS, the Netzels' bankruptcy attorney, says the $2 million claim is related to a "business dispute" between his clients and Tate. Munding says it involves the couple's eBay business, which they continue to run from their home here.

The couple's Chapter 7 filing documents show Tate started a lawsuit against them in San Bernardino County Superior Court, in California.

Munding says $2 million "was the amount alleged," in the lawsuit. "And, of course, it's disputed," he says.

Klinkert could not be reached for comment for this story.

Munding says the lawsuit is pending, and his clients "didn't have the resources to continue to litigate."

The bankruptcy filing lists the Netzels' secured debts at about $642,000, and unsecured debts at about $2.3 million, including the amount in the litigation.

The largest secured debts in the filing are $325,000 owed to Countrywide Home Loans for a Spokane house and lot, and $116,000 owed to Countrywide Home Loans and $174,000 owed to Inland Northwest Bank for a Post Falls home.

Munding says, "The present economy has taken such a downturn. They just can't afford to continue meeting their expenses."