-----BEGIN PRIVACY-ENHANCED MESSAGE-----
Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
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 TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB
MIC-Info: RSA-MD5,RSA,
 IB34MTJfTgQc+fjmiCn1tkGQZtH88aNhvefUdw5cMVGdFc71mHEesCWjIDPRI75p
 Bi/o1eNkwT54twBOiy/UGQ==

<SEC-DOCUMENT>0000919574-04-003586.txt : 20041216
<SEC-HEADER>0000919574-04-003586.hdr.sgml : 20041216
<ACCEPTANCE-DATETIME>20041216165750
ACCESSION NUMBER:		0000919574-04-003586
CONFORMED SUBMISSION TYPE:	4
PUBLIC DOCUMENT COUNT:		1
CONFORMED PERIOD OF REPORT:	20041210
FILED AS OF DATE:		20041216
DATE AS OF CHANGE:		20041216

REPORTING-OWNER:	

	OWNER DATA:	
		COMPANY CONFORMED NAME:			BEDFORD SCOTT
		CENTRAL INDEX KEY:			0001259946

	FILING VALUES:
		FORM TYPE:		4
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-21203
		FILM NUMBER:		041208856

	MAIL ADDRESS:	
		STREET 1:		ONE SANSOME STREET
		STREET 2:		SUITE 3134
		CITY:			SAN FRANCISCO
		STATE:			CA
		ZIP:			94104

REPORTING-OWNER:	

	OWNER DATA:	
		COMPANY CONFORMED NAME:			PENINSULA CAPITAL MANAGEMENT INC
		CENTRAL INDEX KEY:			0000922616
		STATE OF INCORPORATION:			CA
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		4
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-21203
		FILM NUMBER:		041208857

	BUSINESS ADDRESS:	
		STREET 1:		ONE BUSH ST SUITE 1150
		CITY:			SAN FRANCISCO
		STATE:			CA
		ZIP:			94104

	MAIL ADDRESS:	
		STREET 1:		ONE SANSOME STREET
		STREET 2:		SUITE 3134
		CITY:			SAN FRANCISCO
		STATE:			CA
		ZIP:			94104

ISSUER:		

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			DIEDRICH COFFEE INC
		CENTRAL INDEX KEY:			0000947661
		STANDARD INDUSTRIAL CLASSIFICATION:	RETAIL-FOOD STORES [5400]
		IRS NUMBER:				330086628
		STATE OF INCORPORATION:			CA
		FISCAL YEAR END:			0630

	BUSINESS ADDRESS:	
		STREET 1:		28 EXECUTIVE PARK
		STREET 2:		SUITE 200
		CITY:			IRVINE
		STATE:			CA
		ZIP:			92614
		BUSINESS PHONE:		9492601600

	MAIL ADDRESS:	
		STREET 1:		28 EXECUTIVE PARK
		STREET 2:		SUITE 200
		CITY:			IRVINE
		STATE:			CA
		ZIP:			92614
</SEC-HEADER>
<DOCUMENT>
<TYPE>4
<SEQUENCE>1
<FILENAME>p534101_ex.xml
<DESCRIPTION>PENINSULA/DIEDRICH
<TEXT>
<XML>
<?xml version="1.0"?>
<ownershipDocument>

    <schemaVersion>X0202</schemaVersion>

    <documentType>4</documentType>

    <periodOfReport>2004-12-10</periodOfReport>

    <notSubjectToSection16>0</notSubjectToSection16>

    <issuer>
        <issuerCik>0000947661</issuerCik>
        <issuerName>DIEDRICH COFFEE INC</issuerName>
        <issuerTradingSymbol>DDRX</issuerTradingSymbol>
    </issuer>

    <reportingOwner>
        <reportingOwnerId>
            <rptOwnerCik>0000922616</rptOwnerCik>
            <rptOwnerName>PENINSULA CAPITAL MANAGEMENT INC</rptOwnerName>
        </reportingOwnerId>
        <reportingOwnerAddress>
            <rptOwnerStreet1>ONE SANSOME STREET</rptOwnerStreet1>
            <rptOwnerStreet2>SUITE 3134</rptOwnerStreet2>
            <rptOwnerCity>SAN FRANCISCO</rptOwnerCity>
            <rptOwnerState>CA</rptOwnerState>
            <rptOwnerZipCode>94104</rptOwnerZipCode>
            <rptOwnerStateDescription></rptOwnerStateDescription>
        </reportingOwnerAddress>
        <reportingOwnerRelationship>
            <isDirector>0</isDirector>
            <isOfficer>0</isOfficer>
            <isTenPercentOwner>1</isTenPercentOwner>
            <isOther>0</isOther>
        </reportingOwnerRelationship>
    </reportingOwner>

    <reportingOwner>
        <reportingOwnerId>
            <rptOwnerCik>0001259946</rptOwnerCik>
            <rptOwnerName>BEDFORD SCOTT</rptOwnerName>
        </reportingOwnerId>
        <reportingOwnerAddress>
            <rptOwnerStreet1>ONE SANSOME STREET</rptOwnerStreet1>
            <rptOwnerStreet2>SUITE 3134</rptOwnerStreet2>
            <rptOwnerCity>SAN FRANCISCO</rptOwnerCity>
            <rptOwnerState>CA</rptOwnerState>
            <rptOwnerZipCode>94104</rptOwnerZipCode>
            <rptOwnerStateDescription></rptOwnerStateDescription>
        </reportingOwnerAddress>
        <reportingOwnerRelationship>
            <isDirector>0</isDirector>
            <isOfficer>0</isOfficer>
            <isTenPercentOwner>1</isTenPercentOwner>
            <isOther>0</isOther>
        </reportingOwnerRelationship>
    </reportingOwner>

    <nonDerivativeTable>
        <nonDerivativeTransaction>
            <securityTitle>
                <value>Common Stock, par value $0.01 per share</value>
            </securityTitle>
            <transactionDate>
                <value>2004-12-10</value>
            </transactionDate>
            <transactionCoding>
                <transactionFormType>4</transactionFormType>
                <transactionCode>P</transactionCode>
                <equitySwapInvolved>0</equitySwapInvolved>
            </transactionCoding>
            <transactionAmounts>
                <transactionShares>
                    <value>5025</value>
                </transactionShares>
                <transactionPricePerShare>
                    <value>5.44</value>
                </transactionPricePerShare>
                <transactionAcquiredDisposedCode>
                    <value>A</value>
                </transactionAcquiredDisposedCode>
            </transactionAmounts>
            <postTransactionAmounts>
                <sharesOwnedFollowingTransaction>
                    <value>544810</value>
                </sharesOwnedFollowingTransaction>
            </postTransactionAmounts>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>I</value>
                </directOrIndirectOwnership>
                <natureOfOwnership>
                    <value>Footnote 1</value>
                    <footnoteId id="F1"/>
                </natureOfOwnership>
            </ownershipNature>
        </nonDerivativeTransaction>
    </nonDerivativeTable>

    <derivativeTable>
        <derivativeTransaction>
            <securityTitle>
                <value>Warrants</value>
            </securityTitle>
            <conversionOrExercisePrice>
                <value>4.80</value>
            </conversionOrExercisePrice>
            <transactionDate>
                <value>2001-05-08</value>
            </transactionDate>
            <transactionCoding>
                <transactionFormType>4</transactionFormType>
                <transactionCode>P</transactionCode>
                <equitySwapInvolved>0</equitySwapInvolved>
            </transactionCoding>
            <transactionAmounts>
                <transactionShares>
                    <value>41666</value>
                </transactionShares>
                <transactionPricePerShare>
                    <footnoteId id="F2"/>
                </transactionPricePerShare>
                <transactionAcquiredDisposedCode>
                    <value>A</value>
                </transactionAcquiredDisposedCode>
            </transactionAmounts>
            <exerciseDate>
                <footnoteId id="F3"/>
            </exerciseDate>
            <expirationDate>
                <value>2011-05-08</value>
            </expirationDate>
            <underlyingSecurity>
                <underlyingSecurityTitle>
                    <value>Common Stock</value>
                </underlyingSecurityTitle>
                <underlyingSecurityShares>
                    <value>41666</value>
                </underlyingSecurityShares>
            </underlyingSecurity>
            <postTransactionAmounts>
                <sharesOwnedFollowingTransaction>
                    <value>41666</value>
                </sharesOwnedFollowingTransaction>
            </postTransactionAmounts>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>I</value>
                </directOrIndirectOwnership>
                <natureOfOwnership>
                    <value>Footnote 1</value>
                    <footnoteId id="F1"/>
                </natureOfOwnership>
            </ownershipNature>
        </derivativeTransaction>
    </derivativeTable>

    <footnotes>
        <footnote id="F1">The securities reported herein are held in the account of Peninsula Fund, L.P. (&quot;Peninsula&quot;), a private investment fund.
Peninsula Capital Management, Inc. (&quot;PCM&quot;) may be deemed to be a beneficial owner of such securities by virtue of its role
as the general partner of Peninsula. Scott Bedford is the managing member of PCM. Mr. Bedford may be deemed to beneficially
own the securities held by Peninsula by virtue of his status as the managing member of PCM.</footnote>
        <footnote id="F2">The warrants were issued to the Reporting Persons in May 2001 as part of a private placement of common stock and were not
provided at a separate price.</footnote>
        <footnote id="F3">The warrants are exercisable immediately.</footnote>
    </footnotes>

    <remarks>(+) Each of the Reporting Persons (each, a &quot;Reporting Person&quot; and collectively, the &quot;Reporting Persons&quot;) disclaims
beneficial ownership of the reported securities except to the extent of its or his pecuniary interest therein. The
Reporting Persons affirmatively disclaim being a &quot;group&quot; for purposes of Section 16 of the Securities Exchange Act of 1934,
as amended.</remarks>

    <ownerSignature>
        <signatureName>Peninsula Capital Management, Inc.(+) By: /s/ Scott Bedford, Managing Member</signatureName>
        <signatureDate>2004-12-16</signatureDate>
    </ownerSignature>

    <ownerSignature>
        <signatureName>By: /s/ Scott Bedford (+)</signatureName>
        <signatureDate>2004-12-16</signatureDate>
    </ownerSignature>
</ownershipDocument>

</XML>
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
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