The cookie war is almost out of the oven: Dirty Dough, Crumbl reach agreement - East Idaho News (2024)

SALT LAKE CITY (KSL.com) — It seems the cookie war between two popular gourmet cookie shops in Utah may be nearing its end as the companies announced a settlement will soon be reached.

A notice of settlement filed Friday said Crumbl and Dirty Dough “have agreed to terms of settlement” and a written agreement is being finalized.

The notice requested the court to hold off from enforcing all deadlines for pending motions between the two cookie companies for the next 30 days. The companies will file a dismissal request for all claims against Dirty Dough within that period, the court document says.

“In the event Crumbl and Dirty Dough are unable to finalize the settlement for any reason, they will file a request to reset the case deadlines,” the notice says.

The cookie companies released a joint statement to KSL.com Monday that said they reached an “amicable settlement to a trade secret and trade dress infringement dispute.” The joint statement said customers are the “cornerstone of our success” and it was important to them to inform the public about the resolution.

The statement also addressed claims that Dirty Dough’s founder’s brother had taken trade secrets from Crumbl.

“In early 2019, Bradley Maxwell was employed by Crumbl. Prior to the termination of his employment, he downloaded Crumbl recipes and operational information from Crumbl’s internal server. Bradley Maxwell was an early owner and independent contractor of Dirty Dough and he shared this Crumbl information with representatives of Dirty Dough,” the statement said.

Part of the case’s resolution includes Dirty Dough returning the Crumbl information and an agreement that Dirty Dough will change “certain cookie boxes in order to eliminate any potential confusion for customers.”

The statement said the rest of the settlement terms are confidential.

“Crumbl and Dirty Dough are pleased that they have been able to work together to resolve this dispute and each remains dedicated to serving its customers with excellence. Crumbl and Dirty Dough wish each other success in their future endeavors,” the statement concludes.

Cookie war ingredients

The so-called “Utah cookie wars” began in May 2022 when Crumbl filed a federal lawsuit accusing rivals Dirty Dough and Crave Cookie Co. of using what it called “confusingly similar” logos, websites and other marketing materials. The lawsuit also accused Dirty Dough of copying recipes — claiming the founder’s brother is a former Crumbl employee.

Crumbl’s lawsuit details websites, packaging and menu features it believes Crave and Dirty Dough have taken from Crumbl. It includes sections with close-up pictures of cookies, a cookie logo with a bite taken out of it, long boxes that perfectly fit cookies side by side, and similar cookie recipes and presentation such as key lime cookies with white frosting and lime wedges on top or sugar cookies made with fruity cereal.

The lawsuit also claims that both rival businesses have copied Crumbl’s “unique weekly rotating menu concept.”

Crumbl dismissed its lawsuit against Crave on July 20 with ambiguous details, saying in a statement to KSL.com that the two companies “have reached an amicable settlement.”

“Crumbl and Crave are pleased that they have been able to work together to resolve this dispute and each remains dedicated to serving its customers with excellence,” they said in the statement. “Crumbl and Crave wish each other success in their future endeavors. The parties have agreed that the terms of the settlement are confidential.”

Initially, Dirty Dough seemed to embrace the lawsuit in its marketing campaign with billboards highlighting it. One said, “Cookies so good we’re being sued!” while another said, “We don’t file lawsuits, we just have better cookies!”

Near the end of 2022, Dirty Dough founder Bennett Maxwell told KSL that the company had an increase in sales after the lawsuit, calling it “the best thing that could have happened to us.”

That recipe for success, though, didn’t last.

Turning up the heat

Dirty Dough filed a counterclaim against Crumbl in April citing the company’s financial harm from the lawsuit. Dirty Dough alleges that Crumbl caused it financial harm by filing the lawsuit, including loss of investors, inability to obtain loans, legal costs and increased vendor costs.

The company also claims Crumbl filed the lawsuit against a company it saw as a direct competitor “without significant market share and with limited financial resources to fight their claims,” and said Crumbl should have known the lawsuit would not succeed but filed it anyway “in an attempt to stifle growth and competition.”

The company asked the court to allow it to seek money from Crumbl for the losses it has seen because of the lawsuit.

The counterclaim states that the two companies were neither the first nor the only companies to sell fresh cookies in fitted boxes, from brightly lit or modern stores, for delivery or from rotating menus.

Most recently, a federal judge denied a preliminary injunction from Crumbl asking Dirty Dough to return Crumbl’s trade secret information, issue a public statement admitting it had stolen secret Crumbl information and delay opening more franchises until they could determine that Dirty Dough would not continue to use Crumbl’s information. Both companies saw the decision as a victory.

U.S. District Judge Howard Nielson ordered that the trade secrets be returned, but said in the memorandum that Crumbl failed to prove that the other two requests would not negatively affect public interests, including protecting a free marketplace of ideas and free competition in the economic marketplace.

Crumbl said in a statement in August that it was “thrilled” with the decision, even though it didn’t achieve all its aims.

“Crumbl is pleased and strengthened by the recent court order reinforcing our effort to safeguard our intellectual property,” the statement said. “We have achieved a significant legal victory and secured a stipulated order in which Dirty Dough has agreed to return Crumbl’s trade secret information.”

Dirty Dough founder Bennett Maxwell said in a statement he was “very happy” the preliminary injunction was denied.

“This lawsuit has always been about a greedy billion-dollar company suing multiple startups for making cookies in (an) attempt to stifle competition,” Maxwell said. “I am looking forward to winning this lawsuit to hopefully stop Crumbl from suing even more cookie companies due to the shape of their box or use of sprinkles on cookies.”