C. Krueger Cookies Lawsuit: Allegations, Response, and Outcome

The C. Krueger cookies lawsuit was a federal case filed in November 2018 by Cheryl & Co., the Columbus-based baked-goods company owned by 1-800-Flowers.com, against its own founder Cheryl Krueger and her new bakery, C. Krueger’s Finest Baked Goods. Cheryl & Co. accused Krueger of using its proprietary recipes, copying its trade dress, and hiring away four longtime executives to launch what it called a copycat operation less than a month before the suit was filed. Krueger denied the allegations and countersued, calling the case a bid to crush a small competitor. After more than three years of litigation in the Southern District of Ohio, the parties filed a stipulated dismissal on January 7, 2022, ending the case on undisclosed terms.¹

What Cheryl and Co. Alleged

The complaint was filed on November 16, 2018, in the U.S. District Court for the Southern District of Ohio (Case No. 2:18-cv-01485) and assigned to Judge Edmund A. Sargus Jr., with Magistrate Judge Kimberly A. Jolson handling discovery. It named six defendants: Cheryl Krueger, her operating entity CKE Management, LLC, and four former Cheryl & Co. executives.²¹

The dispute traced back to 2005, when 1-800-Flowers.com bought all of Cheryl & Co.’s stock for approximately $40 million.³ Krueger signed an employment agreement with a confidentiality clause covering recipes, customer lists, business plans, and vendor information, and she stayed with the company until she resigned on March 28, 2009. Cheryl & Co. argued the confidentiality obligations had no expiration date.²

Recipes and Trade Secrets

Cheryl & Co. said the 2005 sale price included Krueger’s proprietary recipes for cookies, brownies, cakes, and what it called its “famous buttercream frosting,” and it brought claims under the federal Defend Trade Secrets Act. The company said it kept recipes in a restricted electronic file and required employees to return printed copies at the end of each day. It also pointed to a customer’s Facebook post saying a C. Krueger’s sugar cookie “tastes like it did back then” as evidence the original formulations were in use. The complaint alleged misappropriation of customer lists, vendor relationships, pricing data, profit margins, and product-development plans as well.²

Trade Dress and a Spoofed Email

Under the Lanham Act, Cheryl & Co. alleged the new products were made to look “virtually identical” to its own, singling out the buttercream frosting swirl as proprietary trade dress along with cookie shape, individual wrapping, and marketing materials.⁴ The company also alleged CKE had sent a confirmation email with a spoofed header reading “From: ‘C. KRUEGER’ <cookies@cheryls.com>,” which it said made messages appear to come from Cheryl & Co. and pointed to actual consumer confusion.²

The Four Hired Executives

The suit alleged Krueger had “pirated” four senior employees whose combined experience covered nearly every part of the cookie business: T. David Adell, Director of Food Production since 1987; Amy Coley, Director of Purchasing since 2001; Cindy Dalton, a Business Gift Services Account Manager since 1989 who handled about $2.5 million in annual sales; and Elizabeth Allwein, a senior executive over product development. Cheryl & Co. said each was doing essentially the same job at C. Krueger’s, making reliance on proprietary information “inevitable,” and brought claims for breach of confidentiality and non-compete agreements, misappropriation, and unfair competition. It acknowledged it could not locate a signed copy of Dalton’s restrictive-covenant agreement but said she had been reminded of her obligations at her exit interview.²

How Krueger Responded

In December 2018, Krueger filed counterclaims calling the lawsuit “groundless” and “meritless” and alleging it had been filed to disrupt her startup during the peak holiday season and drive it out of business.⁵

She contested the copycat claims on the specifics. Her cookies, she said, were 20 to 66 percent larger and heavier than Cheryl & Co.’s, used different ingredients, came from different suppliers, and were mostly unfrosted. The buttercream swirl was not proprietary, she argued, but a common decorating technique used by companies including Mrs. Fields. Krueger also said the non-compete portion of her 2005 agreement had expired in 2014, nine years after the sale, and that many of the former employees she hired had never been subject to non-competes at all. She sought damages and legal fees.⁶⁵

How the Case Ended

Discovery produced one ruling that mattered for the recipe fight. In July 2019, Magistrate Judge Jolson denied Cheryl & Co.’s request to have in-house consultants review the disputed recipes, limiting the company’s ability to make side-by-side comparisons of its formulations with those at C. Krueger’s.¹

In September 2020, Judge Sargus granted motions to dismiss filed by Elizabeth Allwein and by Cheryl & Co. itself. In April 2021, he ruled on cross-motions for summary judgment, granting them in part and denying them in part, which left some claims alive for trial. The trial never happened. On January 7, 2022, the parties filed a stipulation of dismissal, the case was terminated on January 11, 2022, and final judgment was entered two days later. The stipulated dismissal indicates a settlement, but the terms were not made public.¹

Where Things Stand

C. Krueger’s Finest Baked Goods survived the litigation. It still ships cookies, brownies, and other baked goods nationwide from a facility in Blacklick, Ohio.⁷⁸⁹

1
CourtListener. Cheryl & Co. v. Krueger Docket
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Courthouse News Service. Cheryl & Co. v. Krueger Complaint
3
Chief Marketer. 1-800-Flowers.com Buys Cheryl & Co.
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The Columbus Dispatch. Cheryl’s Founder Sued Over Cookies
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614now. Cookie Kerfuffle: Cheryl Files Counter Suit Against Former Company
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The Columbus Dispatch. Cheryl Krueger Responds to Cheryl
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C. Krueger’s. Help and Info
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NBC4i. Cheryl Krueger, Founder of Cheryl’s Cookies, Dies After Battle With Parkinson’s
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Dignity Memorial. Cheryl Krueger Obituary