Dirty Dough Countersuit

Case 2:22-cv-00318-HCN-CMR Document 99-1 Filed 04/06/23 PageID.
870 Page 1 of 7
Douglas P. Farr (13208)

Jacob D. Barney (16777)
Jack L. Darrington (18349)
BUCHALTER, P.C.
60 E. South Temple, Suite 1200
Salt Lake City, UT 84111
Telephone: (801) 401-8625
dfarr@buchalter.com
jbarney@buchalter.com
jdarrington@buchalter.com
Attorneys for Defendant Dirty Dough LLC
UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF UTAH, CENTRAL DIVISION
CRUMBL LLC, a Utah Limited Liability

Company, CRUMBL IP, LLC, a Utah DEFENDANT’S
Limited Liability Company, and CRUMBL COUNTERCLAIM
FRANCHISING, LLC, a Utah Limited
Liability Company,
Plaintiff, Civil No. 2:22-cv-00318-HCN-CMR
v. Judge Howard C. Nielson, Jr.
Magistrate Judge Cecilia M. Romero

DIRTY DOUGH LLC, an Arizona Limited
Liability Company, and BRADLEY
MAXWELL, an individual.
Defendant.
DIRTY DOUGH LLC, an Arizona Limited

Liability Company,
Counter Claimant,
1
Case 2:22-cv-00318-HCN-CMR Document 99-1 Filed 04/06/23 PageID.871 Page 2 of 7
v.
CRUMBL LLC, a Utah Limited Liability

Company, CRUMBL IP, LLC, a Utah
Limited Liability Company, and CRUMBL
FRANCHISING, LLC, a Utah Limited
Liability Company
Counter Defendants.
Dirty Dough LLC (“Defendant”) for its Counterclaim against Plaintiffs Crumbl LLC,
Crumbl IP, LLC, and Crumbl Franchising, LLC (“Plaintiffs”), asserts and alleges as follows:
GENERAL ALLEGATIONS
1. Plaintiffs are in the business of selling cookies. Plaintiffs have hundreds of locations
across the United States and generate hundreds of millions of dollars in revenue each year.
2. Defendant is a startup company that is also in the business of selling cookies. At
the time this action was commenced, Defendant had just three locations and was just beginning
franchising operations.
3. Neither Plaintiffs nor Defendant were the first, or are they the only entities, to sell:
cookies; warm cookies; frosted cookies; cookies in boxes; cookies in form fitting boxes; cookies
in modern, brightly lit stores; cookies for delivery; cookies in rotating menus; or cookies in any of
the dozens of other ways that are common in the industry.
4. Plaintiffs’ assertions and allegations that their Trade Dress and Marks are infringed
in any way by Defendant are equally applicable to dozens of manufacturers, distributors,
2
wholesalers, and companies, who also sell cookies but who were not named in this litigation and
have not otherwise been sued by Plaintiffs.
5. Plaintiffs’ Trade Dress and Marks are registered due to their unique specificity, or
otherwise would not qualify for registration.
6. Beyond Plaintiffs’ unique intellectual property and elements, no elements of
commonality between Plaintiffs’ and Defendant’s products are unique to either.
7. Plaintiffs have filed similar lawsuits against some other cookie-based companies,
including Crave Cookies, LLC, asserting similar claims as those asserted against Defendants.
8. The cookie market is competitive.
9. Plaintiffs’ business growth is driven by its ability to sell and support franchises.
10. Plaintiffs’ ability to sell franchises is negatively impacted by any other franchisor
that sells desserts or cookies, thereby impacting Plaintiffs’ growth and profitability.
11. On information and belief, Plaintiffs have specific requirements for the permissible
distance between one of its franchises and another franchise and seeks lease terms that preclude
competition in surrounding spaces owned by the same lessor.
12. Plaintiffs have an economic interesting in standing out and preventing competition,
including any company selling desserts within the vicinity of its franchises.
13. Plaintiffs’ market share is reduced whenever a competitor opens a franchise in
Plaintiffs’ existing or planned markets.
14. Plaintiffs and Defendant are direct competitors in multiple markets.
3
15. Plaintiffs have shown a propensity for filing litigation against competitors who they
allege infringe not only their Trade Dress, but who allegedly also “copy all aspects of [Plaintiffs’]
business.” (Dkt. 23, Am. Compl., ¶ 39).
16. Plaintiffs have an economic interest in preventing competition.
17. On information and belief, Plaintiffs’ franchise specific sales are negatively
impacted by competitors opening franchises in the vicinity of its existing operations.
18. Plaintiffs and Defendant had a business relationship that predated Plaintiffs lawsuit,
but which relationship soured and ended.
19. Plaintiffs’ claims for infringement of its alleged intellectual property lack merit and
include claims that Plaintiffs know or should know are meritless.
20. For instance, Plaintiffs claim that Defendant’s use of a rectangular box infringes
Plaintiffs’ trade dress. However, Plaintiffs’ own filings with this Court show that Plaintiff has
disclaimed the shape of the box as protected intellectual property. (Dkt. 23-3, Am. Compl. Ex. 3.)
21. In addition, Plaintiffs claim photographs of cookies posted on Defendant’s website
infringe Plaintiffs’ intellectual property because they are allegedly similar to photographs Plaintiffs
have posted. In reality, Defendant posted the allegedly infringing photographs before Plaintiffs
posted the photographs Plaintiffs claim were copied.
22. Plaintiffs further provide no evidence of the likelihood of confusion, which is a
necessary element of their trade dress claims.
4
23. Plaintiffs’ assertions and allegations only have been made against defendants
Plaintiffs viewed as direct competitors without significant market share and with limited financial
resources to fight their claims.
24. Plaintiffs knew, or should have known, their claims against Defendant were
unlikely to succeed but proceeded in an attempt to stifle growth and competition.
25. Plaintiffs’ meritless and bad faith claims have caused Defendant significant
financial harm because of the uncertainty created by litigation. This harm includes, but is not
limited to:
a. the Loss of significant investors;
b. the inability to obtain loans from private lenders;
c. the inability to obtain Small Business Administration loans;
d. increased vendor and service provider costs; and
e. unnecessary legal costs and expenses.
26. On information and belief, Plaintiffs intended for their claims to harm Defendant
financially, prevent it from growing, and to impair Defendant’s ability to compete with Plaintiffs
in the very competitive cookie market.
FIRST CLAIM FOR RELIEF

Tortious/Intentional Interference with Economic Relations
(Against Plaintiffs)
27. Defendant incorporates the foregoing responses as if fully set forth herein.
28. Plaintiffs have, and continue to, intentionally interfere with Defendant’s existing or
potential economic relations.
5
29. Plaintiffs’ intentional interference is being pursued by improper means, including
those identified herein.
30. Plaintiffs’ actions have resulted in injury to Defendant in the form of, among others,
lost revenue, slower growth, damage to its reputation, and other direct and consequential damages.
PRAYER FOR RELIEF
Defendant respectfully request an award of damages, including direct, compensatory,
consequential, and punitive damages, in an amount to be proven at trial, plus pre- and post-
judgment interest, attorneys’ fees and costs, and any other relief the Court deems proper or
appropriate.
Dated April __, 2023
BUCHALTER, P.C.
/s/
Douglas P. Farr
Jacob D. Barney
Jack L. Darrington
Attorneys for Defendant Dirty Dough LLC
6
CERTIFICATE OF SERVICE
I hereby certify that on this ___ day of April 2023, I served a true and correct copy of the
foregoing through the Court’s electronic filing and delivery system on following:
Case Collard
Tamara L. Kapaloski
DORSEY & WHITNEY LLP
111 S. Main Street, Suite 2100
Salt Lake City, UT 84111
/s/

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Case 2:22-cv-00318-HCN-CMR Document 99-1 Filed 04/06/23 PageID.

Douglas P. Farr (13208)

Attorneys for Defendant Dirty Dough LLC

UNITED STATES DISTRICT COURT

CRUMBL LLC, a Utah Limited Liability

Plaintiff, Civil No. 2:22-cv-00318-HCN-CMR

v. Judge Howard C. Nielson, Jr.

Magistrate Judge Cecilia M. Romero

DIRTY DOUGH LLC, an Arizona Limited

CRUMBL LLC, a Utah Limited Liability

2. Defendant is a startup company that is also in the business of selling cookies. At

the dozens of other ways that are common in the industry.

in any way by Defendant are equally applicable to dozens of manufacturers, distributors,

have not otherwise been sued by Plaintiffs.

otherwise would not qualify for registration.

6. Beyond Plaintiffs’ unique intellectual property and elements, no elements of

commonality between Plaintiffs’ and Defendant’s products are unique to either.

8. The cookie market is competitive.

competition in surrounding spaces owned by the same lessor.

13. Plaintiffs’ market share is reduced whenever a competitor opens a franchise in

Plaintiffs’ existing or planned markets.

14. Plaintiffs and Defendant are direct competitors in multiple markets.

business.” (Dkt. 23, Am. Compl., ¶ 39).

16. Plaintiffs have an economic interest in preventing competition.

impacted by competitors opening franchises in the vicinity of its existing operations.

but which relationship soured and ended.

include claims that Plaintiffs know or should know are meritless.

21. In addition, Plaintiffs claim photographs of cookies posted on Defendant’s website

posted the photographs Plaintiffs claim were copied.

22. Plaintiffs further provide no evidence of the likelihood of confusion, which is a

necessary element of their trade dress claims.

resources to fight their claims.

unlikely to succeed but proceeded in an attempt to stifle growth and competition.

a. the Loss of significant investors;

b. the inability to obtain loans from private lenders;

c. the inability to obtain Small Business Administration loans;

d. increased vendor and service provider costs; and

e. unnecessary legal costs and expenses.

in the very competitive cookie market.

FIRST CLAIM FOR RELIEF

potential economic relations.

29. Plaintiffs’ intentional interference is being pursued by improper means, including

those identified herein.

PRAYER FOR RELIEF

Defendant respectfully request an award of damages, including direct, compensatory,

Dated April __, 2023

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