Maker of Ice Cream Sold at Grocery Stores Nationwide Files for Bankruptcy as It Appeals $23.8M Judgment

Rebel Creamery LLC, maker of the low-carb, keto-friendly Rebel Ice Cream sold at Walmart, Kroger, Safeway, Target, and other major grocery chains nationwide, filed for Chapter 11 bankruptcy protection on August 14 in the US Bankruptcy Court for the District of Utah, just two days after formally appealing a $23.785 million judgment awarded to rival Van Leeuwen Ice Cream in a trade-dress infringement case.

The Numbers Behind the Filing

The Midway, Utah-based company reported approximately $13.78 million in assets against $23.85 million in liabilities — a gap almost entirely accounted for by the Van Leeuwen judgment, which makes up nearly all of Rebel's fixed unsecured debt. Van Leeuwen is listed among Rebel's creditors with its $23.785 million claim marked as disputed, given the ongoing appeal. Rebel's voluntary petition estimated both assets and liabilities in the $10 million to $50 million range and indicated funds would be available for distribution to unsecured creditors.

How the Legal Battle Began

The dispute traces back to 2021, when Van Leeuwen sued Rebel, alleging the company had copied the distinctive packaging design of its ice cream pints. Van Leeuwen, founded in 2008, redesigned its packaging in 2014 and again in August 2016, working with design firm Pentagram, which studied competing brands and presented seven design concepts before Van Leeuwen's founders selected one. The firm preserved its full design process — briefs, presentations, files, and rejected concepts — which became key evidence at trial.

Rebel Creamery, founded in September 2017, began appearing on grocery store shelves in August 2018 with packaging that Rebel's founders, Austin and Courtney Archibald, said they designed themselves in Adobe Illustrator, without any formal graphic design training. The Archibalds testified they saved no draft versions along the way — only the finished file — a detail that became notable during trial. A Van Leeuwen employee discovered Rebel's similar packaging in late 2018 or early 2019.

What the Judge Found

US District Judge Eric Komitee of the Eastern District of New York ruled on July 16 that Rebel had infringed and diluted Van Leeuwen's trade dress. "The evidence at trial left no doubt that Rebel infringed and diluted Van Leeuwen's trade dress and did so intentionally," Komitee wrote in his order, adding that Van Leeuwen was entitled to $23.785 million of Rebel's profits from sales of ice cream pints bearing the infringing design. The court's ruling specifically pointed to shared design elements including monochromatic cardboard pints with matching lids, a primarily pastel color palette, black script lettering, and an overall minimalist aesthetic.

Evidence presented at trial reportedly included a 2024 customer complaint email in which a shopper described accidentally buying Rebel instead of Van Leeuwen because the packaging "was placed right next to Van Leeuwen and looked the same," adding that a friend on the other side of the country had described the identical mix-up.

Rebel's Defense

Rebel disputed the allegations throughout the litigation, arguing its founders were unaware of Van Leeuwen's packaging when they developed their own design. The court rejected that account. Rebel filed a notice of appeal on August 12, then sought Chapter 11 protection just two days later, on August 14.

What Chapter 11 Means for Shoppers

For customers who regularly buy Rebel's low-carb, high-fat, no-sugar-added keto ice cream — sold in roughly 20 flavors across major retailers — the bankruptcy filing doesn't mean the brand is disappearing from shelves. Chapter 11 generally allows a business to continue normal operations while restructuring its debts under bankruptcy court supervision. The filing also triggers an automatic stay, which generally halts creditors, including Van Leeuwen, from pursuing collection of pre-bankruptcy debts without court permission — effectively pausing enforcement of the judgment while the appeal and bankruptcy proceedings play out in parallel.

What's Still Unclear

Court filings do not establish that the Van Leeuwen judgment was the sole cause of Rebel's bankruptcy filing, and it remains uncertain how the appeal will ultimately affect Van Leeuwen's disputed claim, how much creditors will recover, or whether Rebel will succeed in reorganizing its business. Rebel's filing lists Austin Archibald as the company's manager and member, with Michael Johnson of Ray Quinney & Nebeker serving as bankruptcy counsel.

A Growing but Contentious Market

The dispute plays out against a backdrop of steady growth in the broader ice cream category — industry revenue rose 5.8% to $7.4 billion over the five years through 2025, according to IBISWorld, growing 0.9% in 2025 alone — a competitive landscape that has evidently spilled over into court battles over branding and shelf-space differentiation. For continuing coverage, see Fox Business.

With both the appeal and bankruptcy proceedings now unfolding simultaneously, Rebel Creamery's path forward — and Van Leeuwen's ultimate recovery — will likely hinge on how the two overlapping legal processes resolve in the months ahead.