A courtroom loss can sometimes hit a company harder than any market downturn — and for low-carb ice cream maker Rebel Creamery, that's exactly what happened. One month after a federal judge ruled against it in a bitter trademark fight, Rebel has filed for Chapter 11 bankruptcy protection in Utah, carrying roughly $24 million in debt on its books.

The Numbers Behind the Filing

Court documents filed Friday paint a stark picture: Rebel listed total assets of $13.8 million against liabilities of $23.85 million — a gap wide enough to swallow the company whole. The Utah-based business entered bankruptcy proceedings holding about $5.2 million in cash, according to a declaration filed alongside the petition.

Van Leeuwen Tops the Creditor List

At the center of Rebel's financial collapse sits a single, dominant creditor: rival ice cream brand Van Leeuwen, which secured a $23.8 million judgment against Rebel last month after a lawsuit alleging trade dress infringement and related claims. Rebel hasn't given up the fight entirely — the company has appealed the ruling to the Second Circuit, hoping an appellate court might see the case differently.

A Company Built on Low-Carb Appeal

Founded in 2017, Rebel carved out a niche selling low-carb ice cream in grocery stores nationwide, riding a wave of consumer interest in indulgent treats that didn't come with the usual sugar guilt. But according to the company's own website, those sales are currently frozen — a consequence of a court order from U.S. District Judge Eric Komitee in New York, who barred Rebel from selling pints carrying packaging likely to be confused with Van Leeuwen's distinctive look.

How the Legal Battle Began

Van Leeuwen first sued Rebel back in 2021, accusing the company of trade dress infringement, false designation of origin, and unfair competition under the Lanham Act — including a reverse-confusion theory suggesting consumers might mistake the smaller Van Leeuwen for a Rebel knockoff rather than the other way around. The suit also included New York common law claims for trade dress infringement and unfair competition, plus a state law dilution claim.

Rebel didn't take the accusations lying down, firing back with a counterclaim seeking a court declaration that Van Leeuwen's trade dress wasn't even protectable in the first place, and that Rebel hadn't infringed on anything. The company argued Van Leeuwen's description of its own packaging was too vague and subjective to enforce, that the packaging itself had been used inconsistently over the years, and that the features in question were either purely functional or common enough across the industry to not warrant exclusive protection.

The Judge's Findings

Judge Komitee wasn't persuaded. In a July 2026 ruling, he found that Rebel's pastel-toned, monochromatic cartons paired with black cursive lettering created an overall impression strikingly close to Van Leeuwen's own packaging — close enough, in his view, to cross the line from inspiration into infringement. He went further still, flatly rejecting testimony from Rebel's founders claiming they'd never seen Van Leeuwen's pints while designing their own packaging, calling their account "clearly fabricated."

"The evidence at that trial left no doubt that Rebel infringed and diluted Van Leeuwen's trade dress and did so intentionally," Judge Komitee said, leaving little room for ambiguity in his findings.

The Fallout for Rebel's Packaging

The ruling didn't just cost Rebel money — it forced an operational overhaul, requiring the company to adopt new packaging capable of creating a "substantially different commercial impression" from Van Leeuwen's design, effectively sending Rebel back to the drawing board on its brand identity.

Where the Case Goes From Here

Rebel's bankruptcy case has landed with U.S. Bankruptcy Judge Peggy Hunt, who will now oversee how the company navigates its debts while the appeal plays out separately. Counsel for Rebel did not immediately respond to a request for comment Monday.

Legal Teams Involved

Rebel is represented in the bankruptcy proceedings by Michael R. Johnson, Mark C. Rose and Jeffrey W. Shields of Ray Quinney & Nebeker PC, with Paul Hastings LLP serving as special litigation counsel. In the ongoing appellate case, Rebel's interests are represented by Benjamin W. Snyder of Latham & Watkins LLP and Benjamin Gifford of Paul Hastings LLP.