Popular ice cream maker Rebel Creamery is filing for bankruptcy after it racked up millions of dollars in debt.
The Utah-based company — which sells its low-carb products at major stores such as Walmart, Kroger, Safeway and Target — filed for Chapter 11 bankruptcy protection Friday and listed between $10 million and $50 million in assets and debts, according to court documents.
Rebel filed for bankruptcy less than a month after losing a lawsuit against rival ice cream brand Van Leeuwen over trademark rights.
Van Leeuwen sued Rebel in 2021 and accused the keto-friendly brand of copying its packaging with pastel, minimalistic designs.
The now-bankrupt company was ordered to pay nearly $23.8 million to Van Leeuwen after the judge ruled that Rebel intentionally used packaging that was confusingly similar to the New York-based chain’s branding.
Rebel has denied the allegations and insisted that the designers were unaware of Van Leeuwen’s packaging, despite being founded in 2017 — the year after Van Leeuwen, founded in 2008, introduced its current packaging.
Court documents show that a Van Leeuwen employee discovered the similarities in packaging sometime around early 2019.
Judge Eric Komitee denied Rebel’s explanation of how their packaging was developed, as the company claimed it was without knowledge of Van Leeuwen’s look. He ordered Rebel to redesign its product and to stop selling it in stores.
“The evidence at trial left no doubt that Rebel infringed and diluted Van Leeuwen’s trade dress and did so intentionally,” he wrote in the filing. “As a result, Rebel will be enjoined from selling the infringing products and required to redesign its packaging to avoid any further infringement.”
He added: “Van Leeuwen is entitled to $23.785 million of Rebel’s profits from selling infringing ice cream pints.”
Two days before filing for bankruptcy, Rebel submitted an appeal in the case.
Rebel did not immediately return The Independent’s request for comment.
While Rebel is sold in major grocery stores, Van Leeuwen operates in about 100 shops across the U.S. after being founded as an ice cream truck in New York City in 2008.