Despite all the negative reports, it appears the popular gourmet cupcakes chain Crumbs Bake Shop may not be permanently closing its doors after all.
Several days after shutting down its remaining stores and indicating that it would file for Chapter 7 liquidation, Crumbs instead filed for protection under the reorganization provisions of Chapter 11 of the bankruptcy law, according to The Wall Street Journal. The chain will sell itself to an investor group that includes CNBC host Marcus Lemonis and Dippin’ Dots owner Fischer Enterprises. The group said that it plans to provide the ailing chain with financing to carry it through its time in bankruptcy court and then to acquire its assets in order to create a new, privately held company.
“The company has limited cash, and we are trying to come up with a situation that allows the company to remain viable,” Lemonis told The LA Times. “We are in the final stages of working on a plan to get the stores reopened and people rehired.”
Lemonis explained the investor group’s thinking, suggesting that Crumbs’ downfall was selling only one dessert, according to the news source. Under new leadership, the chain will offer other sweets and bulk up its coffee offering. His own Florida-based candy chain, Sweet Pete’s Candy, will join a number of other brands in being incorporated into the new Crumbs.
In one bit of good news for the investors, the company’s reported net sales in 2013 came to $47.2 million – up from 2012’s figure of $43 million, according to the Journal.
After news broke that Crumbs may be acquired by the investor group, the company’s stock shot back up 990 percent, from 3 cents to 35 cents, according to the LA Times.
The struggle for Crumbs to remain open, reminds me of another desert company that had bouts with bankruptcy. Check out my recent posts on Hostess, the company that brought you the Twinkie and the Ding Dong:
Hostess Brands Inc. Bankruptcy Posed Risk To Other Pensions
Judge Ordered Mediation Between Hostess and Union Fails
Hostess Brands To Shut Its Doors
Hostess Seeks Court Order to Impose New Contract on Union
Special purpose acquisition companies (better known as SPACs) appear to be making a comeback. SPAC offerings for 2025 have already nearly surpassed last year’s totals, with additional transactions in the pipeline. SPACs last experienced a boom between 2020–2021, with approximately 600 U.S. companies raising a record $163 billion in 2021. Notable companies that went public […]
Short Form Merger: Streamlining the Process for Businesses
Merging two companies is a complex legal and business transaction. A short form merger, in which an acquiring company merges with a subsidiary corporation, offers a more streamlined process that involves important corporate governance considerations. A short form merger, in which an acquiring company merges with a subsidiary corporation, offers a more streamlined process. However, […]
Tariff Response Options for Small Businesses Facing Financial Distress
The Trump Administration’s new tariffs are having an oversized impact on small businesses, which already tend to operate on razor thin margins. Many businesses have been forced to raise prices, find new suppliers, lay off staff, and delay growth plans. For businesses facing even more dire financial circumstances, there are additional tariff response options, including […]
Common Causes of Partnership Disputes and How to Resolve Them
Business partnerships, much like marriages, function exceptionally well when partners are aligned but can become challenging when disagreements arise. Partnership disputes often stem from conflicts over business strategy, financial management, and unclear role definitions among partners. Understanding Business Partnership Conflicts Partnership conflicts place significant stress on businesses, making proactive measures essential. Partnerships should establish detailed […]
Businesses Are Facing Financial Headwinds—A Practical Guide
*** The original article was featured on Bloomberg Tax, April 28, 2025 — As a tax attorney who spends much of my time helping people and companies who have large, unresolved issues with the IRS or one or more state tax departments, it often occurs to me that the best service that I can provide […]
President Trump's Termination of Member Gwynne Wilcox
On January 28, 2025, the Trump Administration terminated Gwynne Wilcox from her position as a Member of the National Labor Relations Board (NLRB or the Board). Gwynne Wilcox, a union side lawyer for Levy Ratner, was confirmed to the Board for an original term in 2021 and confirmed again for a successive five-year term expiring […]
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.
Let`s get in touch!
Sign up to get the latest from the Scarinci Hollenbeck, LLC attorneys!
