View source for Tully's Coffee

{{Short description|American specialty coffee brand}}
{{Infobox brand
| name   = ''Tully's Coffee''
| logo   = Tully's Coffee logo.png
| image  =
| image_upright =
| alt          =
| caption      =
| producttype  = [[Coffee]]
| currentowner = [[Keurig Dr Pepper]]
| producedby   =
| country      = U.S.
| introduced   = {{start date and age|1992}}
| discontinued =
| related      =
| markets      =
| previousowners =
| trademarkregistrations =
| ambassadors =
| tagline     =
| website     =
| module      = <!-- or: misc -->
| module1     = <!-- or: misc1 -->
}}
'''Tully's Coffee''' is an American specialty [[coffee]] [[manufacturing]] [[brand]] owned by [[Keurig Dr Pepper]], which acquired ''Tully's'' brand and wholesale business in 2009.<ref>{{cite news|url=http://www.seattleweekly.com/news/stormy-days-for-tullys-coffee/|title=Stormy Days for Tully's Coffee |newspaper=[[Seattle Weekly]]|date=4 April 2018|access-date=7 August 2018}}</ref><ref>{{cite web|url=http://www.businessinsider.com/stormy-daniels-lawyer-michael-avenatti-tullys-coffee-lawsuits-2018-5|title=Stormy Daniels' lawyer once bought a coffee chain for $9 million with a famous Hollywood actor — and all the shops mysteriously closed earlier this year amid dozens of lawsuits|website=businessinsider.com|access-date=7 August 2018}}</ref><ref>{{cite web|url=http://mynorthwest.com/1019024/tullys-coffee-company-closures/?|title=What has happened to Seattle's Tully's Coffee?|date=14 June 2018|website=Mynorthwest.com|access-date=7 August 2018}}</ref>

Tully's branded coffee continues to be sold by Keurig in its K-Cup format and as bagged ground coffee.
<ref>{{Cite web|url=https://www.keurig.com/beverages/c/beverages101?q=brand:TULLYS&sort=popular-all|title=Shop All Beverage K-Cup® Pods, Bags, & Cans &#124; Coffee, Tea, & More &#124; Keurig}}</ref>

At the time of the Keurig wholesale acquisition, the "''Tully's''" name and retail-store rights were retained by the now-defunct original retailer and wholesaler chain of coffee shops based in [[Seattle]], [[Washington (state)|Washington]], which had been originated by Tom "Tully" O'Keefe in 1992. Its stores served specialty coffees, espresso, baked goods, pastries, and coffee-related supplies. The U.S. chain permanently closed in September 2018.

The coffee-shop chain also has overseas licensing agreements in [[Japan]], which since 2006 have been owned by [[Ito En]], Inc. The brand name is used for over 760 ''Tully's'' coffee houses in Japan (as of April 2022).<ref>{{Cite web|url=https://www.tullys.co.jp/|title=Taste The Difference &#124; TULLY'S COFFEE - タリーズコーヒー|website=www.tullys.co.jp}}</ref>

''Tully's'' coffee shops were well known for once following an expansion strategy of opening stores adjacent to those of the considerably larger coffee chain [[Starbucks]], also based in Seattle.

==History==
===Inception===
[[File:Wiki-tullys-coffee.jpg|thumb|Typical Tully's Coffee store]]
Tully's opened its first store in [[Kent, Washington]] in September 1992.<ref>{{cite web |url=http://www.tullyscoffeeshops.com/franchise/domestic/ |title=Tully's Coffee: A Fully Handcrafted Coffee Roaster! |website=Tullyscoffeeshops.com |access-date=2012-10-24 |archive-date=2018-08-07 |archive-url=https://web.archive.org/web/20180807185854/http://www.tullyscoffeeshops.com/franchise/domestic/ |url-status=usurped }}</ref>

The founder of Tully's Coffee, Tom "Tully" O'Keefe, who retired from the company in 2010, planned to rival the quickly expanding [[Starbucks|Starbucks coffee]]. Tully's quickly developed into a strong regional specialty coffee retailer concentrated in Puget Sound, where coffee loyalty is so deep there is one coffee shop for every 4,000 people. In 2006, Tully's made its first net profit. Tully's focus was no longer on competing against Starbucks but on serving hand-crafted coffee in its local Seattle area retail coffee shops. The company had franchisees and grocery chain coffee shops in the U.S. and Asia.<ref name=":0">{{Cite web|url=https://abcnews.go.com/Business/patrick-dempsey-wins-bid-tullys-coffee/story?id=18131760|title='McDreamy' Wins Tully's Coffee|date=2013-01-04|website=ABC News|access-date=2017-11-14}}</ref>

It operated stores in the [[Greater Puget Sound]] area of [[Washington (state)|Washington]], [[California]],<ref name=":0" /> [[Idaho]], [[Arizona]], [[Colorado]],<ref>{{cite news |last=Migration |first= |date=November 29, 2012 |title=Boulder-based Kachi agrees to buy troubled coffee chain Tully's |url=https://www.denverpost.com/2012/11/29/boulder-based-kachi-agrees-to-buy-troubled-coffee-chain-tullys/ |work=The Denver Post |access-date=July 13, 2025}}</ref> and licensed its brand for use in [[South Korea]] and Japan. It had also opened stores in [[Singapore]], [[Metro Manila]], [[Beijing]] and [[Stockholm|Stockholm, Sweden]].

Tully's opened its first Japanese outlet in [[Ginza]], [[Tokyo]], in 1997.<ref name=":1">{{Cite web|url=http://www.tullys.co.jp/company/message.html|title=トップメッセージ {{!}}会社情報 {{!}}TULLY'S COFFEE - タリーズコーヒー|website=www.tullys.co.jp|language=ja|access-date=2018-11-19}}</ref> Tully's opened in Japan after a 33-year-old [[Sanwa Bank]] employee, [[Kota Matsuda]], personally appealed to O'Keefe to open a chain of high-quality coffee shops in Japan.<ref name=":2">{{Cite news|url=https://www.japantimes.co.jp/news/2002/01/19/national/coffee-shops-on-different-tracks-in-japan/|title=Coffee shops on different tracks in Japan|last=Yoshida|first=Reiji|date=2002-01-19|work=The Japan Times Online|access-date=2018-11-19|language=en-US|issn=0447-5763}}</ref> Matsuda became the CEO of Tully's Coffee Japan, a joint venture between Tully's, Matsuda and several outside investors.<ref>{{Cite web|url=https://www.bizjournals.com/seattle/stories/1998/05/18/daily9.html|title=Tully's Coffee forms Tully's Coffee Japan|date=1998-05-20|website=www.bizjournals.com|access-date=2018-11-19}}</ref> Unlike its rival Starbucks, which chose to run its stores in Japan directly, Tully's expanded in Japan through franchising.<ref name=":2" /> Tully's sold a portfolio of intellectual property to TCJ in August 2005 for over $13 million,<ref>{{Cite web|url=https://www.sec.gov/Archives/edgar/data/944136/000119312505179791/d8k.htm|title=Form 8-K|website=www.sec.gov|access-date=2018-11-19}}</ref> and the Japanese tea maker acquired TCJ [[Ito En]] in 2006.<ref name=":1" />

In August 2007, plans for an [[Initial public offering|IPO]] were placed on hold by the company, citing a "volatile market." This decision was made right after the company was advised by its bankers to refrain from going forward with the IPO due to a tremendously declining stock market. The company pursued alternative sources of capital and sought all strategic investment or sale opportunities as a result. Fiscal 2006 losses amounted to $9.7 million.

===Sale of wholesale coffee-bean distribution business, brand, and roasting operation===
Tully sold its North American wholesale coffee-bean distribution business, brand (which it licensed back for $1/year in perpetuity), and roasting operation to [[Green Mountain Coffee Roasters]] in 2009, earning $40.3 million in the deal, allowing the company to pay off 100% of its debt, including trade debt, make a cash distribution to shareholders, and maintain substantial cash reserves for the expansion of its retail business.<ref>{{cite news|url=https://www.boston.com/business/ticker/2008/09/vermont_coffee.html |title=Vermont coffee company will buy Seattle brand  |newspaper=[[The Boston Globe]] |date=2008-09-16 |access-date=2012-10-24}}</ref> Tully's retained all retail rights for North America, and all wholesale and retail rights for the balance of the world, excluding Japan.

In 2010, Tully's Coffee International and DK Retail Co., Ltd. entered into a Master Licensing Agreement to develop up to 100 retail stores in South Korea.<ref>{{cite web|url=http://www.chainleader.com/article/450902-Tully_s_Coffee_Plans_100_Locations_in_South_Korea.php|title=Tully's Coffee Plan 100 Locations in South Korea|website=Chainleader.com|access-date=2012-10-24}}</ref>

Founder and Chairman Tom T. O'Keefe retired in 2010.<ref>{{cite news|last=Allison |first=Melissa |url=http://seattletimes.nwsource.com/html/businesstechnology/2011453987_tullys27.html |title=Tom O'Keefe, founder of Tully's Coffee, retiring as chairman in June |newspaper=[[Seattle Times]] |date=2010-03-26 |access-date=2012-10-24}}</ref><ref name=STimes101012 />

===US coffeeshop closures===
The Tully's Coffee board and management filed for Chapter 11 bankruptcy in October 2012, citing low cash reserves and the need to renegotiate leases with landlords. At the time of the filing, Tully's had recently closed or was about to close 17 unprofitable company-owned stores.<ref name=STimes101012>{{cite news|last=Allison |first=Melissa |url=http://seattletimes.com/html/businesstechnology/2019393286_tullyscoffeexml.html |title=Struggling Tully's new plan: bankruptcy protection &#124; Business & Technology |newspaper=[[The Seattle Times]] |access-date=2012-10-24}}</ref> Global Baristas, an investment group led by actor [[Patrick Dempsey]] had the highest bid of US$9.15 million to buy Tully's at a bankruptcy auction on January 3, 2013.<ref name="auction">{{cite news|last=Allison |first=Melissa |url=http://seattletimes.com/html/businesstechnology/2020054537_tullys04.html |title=Patrick Dempsey, TV's "McDreamy," wins bid to buy Tully's |newspaper=[[The Seattle Times]] |date=January 3, 2013 |access-date=2013-01-04}}</ref> U.S. Bankruptcy Court Judge Karen Overstreet subsequently approved the sale to Global Baristas, rejecting objections from Starbucks and other prospective buyers.<ref name="saleapproved">{{cite web|url=http://www.bizjournals.com/seattle/blog/2013/01/judge-rules-in-favor-of-dempsey-in.html|title=Tully's tussle over: Judge rules in favor of Patrick Dempsey's group|website=Bizjournals.com|access-date=7 August 2018}}</ref> The deal became final on June 30, with all employees keeping their jobs and getting a bonus of two vacation days as a "thank you" for their commitment to the company. Dempsey later backed out of the partnership and filed a lawsuit against his former partner and attorney [[Michael Avenatti]].<ref>{{cite web|url=https://www.latimes.com/politics/la-na-pol-avenatti-stormy-trump-20180407-story.html|title=Trump meets his match: Stormy Daniels' combative lawyer Michael Avenatti|first=Michael Finnegan, Maura|last=Dolan|website=[[Los Angeles Times]]|date=7 April 2018 |access-date=7 August 2018}}</ref><ref>{{cite news|url=http://seattletimes.com/html/businesstechnology/2021308029_tullysclosexml.html|title=Dempsey group closes on Tully's deal, offers jobs to all workers|newspaper=[[The Seattle Times]]|access-date=7 August 2018}}</ref>

In September 2017, Tully's Coffee announced it would close 12 locations in the Puget Sound region that were located inside [[Boeing]] facilities, including the [[Boeing Everett Factory|Everett]] and [[Boeing Renton Factory|Renton]] assembly factories.<ref>{{cite news |last=Greenstone |first=Scott |date=September 20, 2017 |title=12 Tully's Coffee locations at Boeing to close, with each side blaming the other |url=https://www.seattletimes.com/business/retail/12-tullys-coffee-locations-at-boeing-to-close-with-each-side-blaming-the-other/ |work=The Seattle Times |accessdate=August 11, 2023}}</ref> They had originally opened in 2006 as part of an agreement between the two companies.<ref>{{cite news |last=Corliss |first=Bryan |date=February 27, 2006 |title=Tully's to open four coffee shops at Boeing plant |url=https://www.heraldnet.com/business/tullys-to-open-four-coffee-shops-at-boeing-plant/ |work=[[The Everett Herald]] |accessdate=August 11, 2023}}</ref>

On March 8, 2018, Tully's announced that it was closing its remaining stores temporarily due to a lack of coffee.<ref>{{cite news |last=Grunbaum |first=Rami |date=March 8, 2018 |title=Tully's suspends store operations for lack of coffee |url=https://www.seattletimes.com/business/tullys-suspends-store-operations-for-lack-of-coffee/ |work=The Seattle Times |access-date=April 11, 2018}}</ref> Later that month, many Tully's locations remained closed with eviction notices posted by landlords indicating the lack of payment.

In April 2018, Tully's coffee was sued by [[Daytona International Speedway]].<ref>{{Cite news|url=https://www.seattletimes.com/business/latest-legal-blow-to-tullys-coffee-comes-from-daytona-speedway/|title=Latest legal blow to Tully's Coffee comes from … Daytona Speedway|date=April 5, 2018 |work=The Seattle Times|author1= Grunbaum, Rami |access-date=May 6, 2018|language=en-US}}</ref>

Tully's US coffeehouse business was officially closed when Keurig and Global Baristas entered a permanent injunction in September 2018. Global Baristas agreed to never operate a coffee chain, or any other food or beverage business, under the name again, and Keurig will continue to sell Tully's branded coffee.<ref name="OfficiallyClosed">{{cite news|
url= https://www.businessinsider.com/michael-avenattis-coffee-chain-tullys-is-dead-2018-10|
author1= Taylor, Kate |
title= The coffee chain once purchased by Michael Avenatti and Patrick Dempsey is finally, truly dead |
website=Business Insider |
date=October 24, 2018}}</ref>

An involuntary [[Chapter 7, Title 11, United States Code|Chapter 7 bankruptcy]] liquidation petition was filed against Global Baristas in October 2018.<ref>{{cite news |last1=Taylor |first1=Kate |title=Unpaid taxes, abruptly closed locations, and employee rebellions: Inside the 6-year downfall of Michael Avenatti's coffee chain |url=https://www.businessinsider.com/michael-avenatti-coffee-chain-tullys-closed-timeline-2019-3 |access-date=26 January 2024 |work=[[Business Insider]] |date=11 April 2019}}</ref>

Tully's still operates overseas through franchise agreements, with 760 stores in Japan as of April 2022.<ref name="ITO E FY2021 Financial Report">{{Cite report|url=http://www.itoen-global.com/ir/pdf/2022/pr/apr22.pdf|title=ITO EN Ltd Financial Results Presentation for FY2021|page=16}}</ref>

==References==
{{Reflist}}

==External links==
* [http://www.tullys.com/ Tullys.com]
* {{usurped|1=[https://web.archive.org/web/20180519192505/http://www.tullyscoffeeshops.com/ TullysCoffeeShops.com]}} Archived May 19, 2018

{{Coffee in Seattle}}
{{Keurig Dr Pepper brands}}
{{Fast-food chains of the United States}}
{{Food chains in Japan}}

[[Category:Coffee brands]]
[[Category:Coffeehouses and cafés in Japan]]
[[Category:Coffee in Seattle]]
[[Category:Defunct companies based in Seattle]]
[[Category:Defunct restaurant chains in the United States]]
[[Category:Regional restaurant chains in the United States]]
[[Category:American companies established in 1992]]
[[Category:American companies disestablished in 2018]]
[[Category:Keurig Dr Pepper brands]]
[[Category:1992 establishments in Washington (state)]]
[[Category:2018 disestablishments in Washington (state)]]
[[Category:Food and drink companies established in 1992]]
[[Category:Food and drink companies disestablished in 2018]]
[[Category:2009 mergers and acquisitions]]
[[Category:Companies that filed for Chapter 11 bankruptcy in 2012]]