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Louisville Crumbl Cookies Location Closed After Bankruptcy

The franchise operator at 291 N. Hubbards Lane has filed for Chapter 7 bankruptcy to liquidate its assets.

Updated on Oct. 9, 2026 in Openings & Closings

Isometric editorial illustration showing a simplified, matte-rendered modern commercial building entrance with a locked door, representing a business liquidation.
Red Sheep St. Matthews LLC has permanently closed its Crumbl Cookies storefront on Hubbards Lane in Louisville following a Chapter 7 bankruptcy filing. AI Illustration. Upload story photo >

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Red Sheep St. Matthews LLC has permanently shuttered its Crumbl Cookies storefront in Louisville after filing for bankruptcy on Oct. 1, 2026. The closure follows a period of financial distress for the operator, which reported significant liabilities.

Why it matters

The company faced $352,780.03 in total liabilities, with a majority of that debt owed to Republic Bank. This move marks a consolidation effort as the broader chain experiences shifts in market demand.

The firm reported total liabilities of $352,780.03 against $10,000 in assets, including $269,108.74 in secured debt owed to Republic Bank. While this site closed, five other Crumbl locations continue to operate throughout the Louisville area.

The players

Red Sheep St. Matthews LLC

This entity served as the local franchisee for the Crumbl Cookies brand in the St. Matthews area of Louisville.

Republic Bank

This financial institution is a creditor listed in the bankruptcy filing with a secured claim of $269,108.74.

Richard and Emily Diamond

They are the owners of the Red Sheep St. Matthews LLC franchise entity.

The details

Owners Richard and Emily Diamond ceased operations at the 291 N. Hubbards Lane location following the filing in the U.S. Bankruptcy Court for the Western District of Kentucky. The decision comes amidst a wider trend that saw at least 57 Crumbl locations close across the country in 2026.

Timeline

  1. The Crumbl chain was originally founded in Utah in 2017.

  2. The St. Matthews storefront first opened in early 2024.

  3. A new Louisville Crumbl location opened at 10970 Dixie Highway on Aug. 28, 2026.

  4. The bankruptcy filing was officially submitted on Oct. 1, 2026.

Market Landscape

This closure follows a broader trend of contraction within the franchise, mirroring a 32% year-over-year chain traffic decline observed in August 2026. While individual operators face unique financial pressures, the brand is navigating a landscape where rapid expansion has met cooling consumer interest.

Customers who frequented the Hubbards Lane store will need to visit one of the five remaining Louisville-area locations for service. The closure does not affect the operations or accessibility of other independent Crumbl franchises in the region.

The takeaway

Franchise business models remain highly sensitive to regional traffic fluctuations and local debt obligations. Prospective investors should note that even popular national brands can face significant liquidation hurdles when operating costs exceed site-level performance.

Further reading

For more updates on local retail shifts, visit the Louisville Openings & Closings section.

Source note: This article includes information reported by The Courier-Journal.

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