SC 14D9/A

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14D-9

(RULE 14d-101)

SOLICITATION/RECOMMENDATION STATEMENT UNDER SECTION 14(d)(4)

OF THE SECURITIES EXCHANGE ACT OF 1934

(Amendment No. 3)

DIEDRICH COFFEE, INC.

(Name of Subject Company)

DIEDRICH COFFEE, INC.

(Name of Person Filing Statement)

COMMON STOCK, PAR VALUE $0.01 PER SHARE

(Title of Class of Securities)

253675201

(CUSIP Number of Class of Securities)

Sean M. McCarthy

Chief Financial Officer

Diedrich Coffee, Inc.

28 Executive Park, Suite 200

Irvine, California 92614

(949) 260-1600

(Name, address and telephone number of person authorized to receive notices

and communications on behalf of the person filing statement)

Copies to:

John M. Williams

Gibson, Dunn & Crutcher LLP

3161 Michelson Drive, Suite 1200

Irvine, California 92612

(949) 451-3800

¨ Check the box if the filing relates solely to preliminary communications made before the commencement of a tender offer.

This Amendment No. 3 to the Solicitation/Recommendation Statement on Schedule 14D-9 amends and supplements the Solicitation/Recommendation Statement on Schedule 14D-9 initially filed by Diedrich Coffee, Inc., a Delaware corporation (“Diedrich”), with the Securities and Exchange Commission (the “SEC”) on December 11, 2009, as amended by Amendment No. 1 and Amendment No. 2 to the Solicitation/Recommendation Statement on Schedule 14D-9 filed by Diedrich with the SEC on December 31, 2009, and January 11, 2010, respectively (as amended or supplemented from time to time, the “Schedule 14D-9”). The Schedule 14D-9 relates to the offer by Green Mountain Coffee Roasters, Inc., a Delaware corporation (“GMCR”), through its wholly owned subsidiary, Pebbles Acquisition Sub, Inc., a Delaware corporation (“Purchaser”), to acquire all issued and outstanding shares of Diedrich’s common stock, par value $0.01 per share (“Common Stock”), in exchange for, with respect to each share, the right to receive $35.00 in cash, without interest, upon the terms and subject to the conditions set forth in GMCR’s offer to purchase, dated December 11, 2009 (the “Offer to Purchase”). The Offer to Purchase is contained in the Schedule TO filed by GMCR with the SEC on December 11, 2009 (as amended or supplemented from time to time, the “Schedule TO”), and in the related Letter of Transmittal (the “Letter of Transmittal,” together with the Offer to Purchase and any amendments or supplements thereto, collectively constituting the “Offer”). Any capitalized term used and not otherwise defined herein shall have the respective meanings ascribed to such terms in the Schedule 14D-9.

Item 4. The Solicitation or Recommendation

Item 4 of the Schedule 14D-9 is hereby amended and supplemented by adding the following paragraph after the last paragraph under the subheading “Background of the Offer”:

Effective December 24, 2009, following consultation with the staff of the Federal Trade Commission (the “FTC”), GMCR voluntarily withdrew its HSR Act filing. On December 29, 2009, GMCR re-filed its HSR Act filing. This withdrawal and re-filing was undertaken in order to provide the FTC with additional time to review the information submitted by GMCR and Diedrich.

On January 13, 2010, Diedrich and GMCR each received a request for additional information (a “Second Request”) from the FTC with respect to the Offer and Merger. Diedrich and GMCR expect to promptly respond to their respective Second Requests, and to continue to work cooperatively with the FTC as it conducts its review of the proposed transaction.

Item 8. Additional Information.

Item 8 of the Schedule 14D-9 is hereby amended and supplemented by adding the following after the last paragraph under the subheading entitled “Antitrust Laws”:

On December 8, 2009, Diedrich filed a Notification and Report Form with respect to the Offer and Merger, pursuant to the requirements of the HSR Act. On December 9, 2009, GMCR, on behalf of itself and Purchaser, filed a Notification and Report Form with respect to the Offer and Merger with the FTC and the Department of Justice, pursuant to the requirements of the HSR Act. Following consultation with the FTC staff, GMCR voluntarily withdrew its Notification and Report Form effective December 24, 2009, and re-filed its Notification and Report Form on December 29, 2009, in order to provide the FTC with additional time to review the information submitted by GMCR and Diedrich.

On January 13, 2010, Diedrich and GMCR issued a joint press release announcing that Diedrich and GMCR each had received a Second Request for additional information from the FTC regarding the Offer and Merger. As a result of the Second Requests, the waiting period under the HSR Act during which the FTC is permitted to review the proposed transaction has been extended until 11:59 p.m., Eastern Time, on the 10th day after the companies’ substantial compliance with the Second Requests, or until 11:59 p.m., Eastern Time, on the next business day following that date, if the 10th day falls on a weekend or federal holiday. Diedrich and GMCR expect to promptly respond to their respective Second Requests, and to continue to work cooperatively with the FTC as it conducts its review of the proposed transaction. GMCR and Purchaser will extend the Offer’s expiration time as necessary to occur concurrently with the expiration of the HSR waiting period.

The full text of the press release issued by Diedrich and GMCR on January 13, 2010, announcing the receipt of the FTC’s Second Requests is filed as Exhibit (a)(9) hereto and is incorporated herein by reference.

Item 9. Exhibits.

Item 9 is supplemented by adding the following exhibit:

Exhibit	Description
(a)(9)	Joint Press Release issued on January 13, 2010.

Annex A. Information Statement pursuant to Section 14(f) of the Securities Exchange Act of 1934 and Rule 14f-1 thereunder

Annex A is hereby amended and supplemented by replacing the subsection entitled “Director Compensation Table” on page A-16 in its entirety with the following:

Director Compensation Table

The following table shows the 2009 fiscal year compensation for Diedrich’s non-employee directors.

Name	Fees Earned or Paid in Cash ($)		Option Awards ($)(1)		Total ($)
Paul C. Heeschen.	$	22,000	$	13,013	$	35,013
Gregory D. Palmer		23,500		15,340		38,840
Timothy J. Ryan(2)		50,062		28,363		78,425
James W. Stryker		10,500		2,999		13,499

(1) This column represents the dollar amount recognized for financial statement reporting purposes with respect to the 2009 fiscal year for the fair value of stock options for each of the directors in accordance with SFAS No. 123R. The amounts shown exclude the impact of estimated forfeitures related to service-based vesting conditions. For additional information on the valuation assumptions with respect to the 2009 grants, refer to Note 1 to the consolidated financial statements of Diedrich’s Annual Report on Form 10-K, filed on September 22, 2009.

(2) Fees earned include compensation as Vice Chairman of the board in the amount of $27,562.

SIGNATURES

After due inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

Dated: January 13, 2010

DIEDRICH COFFEE, INC.
By:	/s/ SEAN M. MCCARTHY
Name:	Sean M. McCarthy
Title:	Chief Financial Officer

EX-99.(A)(9)

Exhibit (a)(9)

For Immediate Release

GREEN MOUNTAIN COFFEE ROASTERS, INC. AND DIEDRICH COFFEE, INC. RECEIVE

REQUESTS FOR ADDITIONAL INFORMATION FROM FTC

WATERBURY, Vt. and IRVINE, Calif. – January 13, 2010 – Green Mountain Coffee Roasters, Inc. (NASDAQ: GMCR) (“GMCR”) and Diedrich Coffee, Inc. (Nasdaq: DDRX) (“Diedrich Coffee”) today announced that they have each received a request for additional information (“Second Requests”) from the U.S. Federal Trade Commission (“FTC”) with respect to the previously announced $35.00 per share cash tender offer by Pebbles Acquisition Sub, Inc. (the “Purchaser”), a wholly owned subsidiary of GMCR, to purchase all of the outstanding shares of common stock of Diedrich Coffee.

As a result of the Second Requests, the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (“HSR Act”) during which the FTC is permitted to review the proposed transaction has been extended until 11:59 p.m., Eastern Time, on the 10th day after the companies’ substantial compliance with the Second Requests, or until 11:59 p.m., Eastern Time, on the next business day following that date, if the 10th day falls on a weekend or Federal holiday.

GMCR and Diedrich Coffee expect to promptly respond to their respective Second Requests, and to continue to work cooperatively with the FTC as it conducts its review of the proposed transaction. The transaction is expected to be completed in early 2010.

As previously announced, the tender offer is scheduled to expire at midnight, New York City time, on Friday, February 5, 2010. The Purchaser will extend the tender offer’s expiration time as necessary to occur concurrently with the HSR waiting period’s expiration time.

BofA Merrill Lynch is serving as financial advisor to GMCR on this transaction and Ropes & Gray LLP is serving as its legal advisor.

Houlihan, Lokey, Howard & Zukin Capital, Inc. is serving as financial advisor to Diedrich Coffee and Gibson, Dunn & Crutcher LLP is serving as legal advisor.

About Green Mountain Coffee Roasters, Inc. (NASDAQ: GMCR)

As a leader in the specialty coffee industry, Green Mountain Coffee Roasters, Inc. is recognized for its award-winning coffees, innovative brewing technology, and socially responsible business practices. GMCR’s operations are managed through two business units. The Specialty Coffee business unit produces coffee, tea and hot cocoa from its family of brands, including Tully’s Coffee^®, Green Mountain Coffee^®, Newman’s Own^® Organics coffee and Timothy’s World Coffee^®. The Keurig business unit is a pioneer and leading manufacturer of gourmet single-cup brewing systems. K-Cup^® portion packs for Keurig^® Single-Cup Brewers are produced by a variety of licensed roasters, including Green Mountain Coffee, Tully’s Coffee and Timothy’s. GMCR supports local and global communities by offsetting 100% of its direct greenhouse gas emissions, investing in Fair Trade Certified™ coffee, and donating at least five percent of its pre-tax profits to social and environmental projects. Visit www.gmcr.com for more information.

GMCR routinely posts information that may be of importance to investors in the Investor Relations section of its web site, including news releases and its complete financial statements, as filed with the SEC. GMCR encourages investors to consult this section of its web site regularly for important information and news. Additionally, by subscribing to GMCR’s automatic email news release delivery, individuals can receive news directly from GMCR as it is released.

About Diedrich Coffee, Inc. (NASDAQ: DDRX)

Diedrich Coffee specializes in sourcing, roasting and selling the world’s highest quality coffees. The company markets its three leading brands of specialty coffees, Diedrich Coffee, Coffee People and Gloria Jean’s Coffees, through office coffee service distributors, restaurants and specialty retailers, and via the company’s web stores. Diedrich Coffee is one of the few roasters under license to produce K-Cups for Keurig Incorporated’s top-selling single-cup brewing system. For more information about Diedrich Coffee, call 800-354-5282, or go to www.diedrich.com, www.coffeepeople.com or www.coffeeteastore.com.

Forward-looking statements

Certain statements contained herein, including GMCR’s intention to complete the proposed acquisition, are not based on historical fact and are “forward-looking statements” within the meaning of the applicable securities laws and regulations. The “safe harbor” set forth in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, does not apply to forward-looking statements made in connection with a tender offer. Generally, these statements can be identified by the use of words such as “anticipate,” “believe,”, “could,” “estimate,” “expect,” “feel,” “forecast,” “intend,” “may,” “plan,” “potential,” “project,” “should,” “would,” and similar expressions intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Owing to the uncertainties inherent in forward-looking statements, actual events or results could differ materially from those stated herein. Factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to, the impact on sales and profitability of consumer sentiment in this difficult economic environment, GMCR’s success in efficiently expanding operations and capacity to meet growth, GMCR’s success in efficiently and effectively integrating Tully’s and Timothy’s wholesale operations and capacity into its Specialty Coffee business unit, GMCR’s success in introducing new product offerings, the ability of lenders to honor their commitments under GMCR’s credit facility, competition and other business conditions in the coffee industry and food industry in general, fluctuations in availability and cost of high-quality green coffee, any other increases in costs including fuel, Keurig’s ability to continue to grow and build profits with its roaster partners in the At Home and Away from Home businesses, the impact of the loss of major customers for GMCR or reduction in the volume of purchases by major customers, delays in the timing of adding new locations with existing customers, GMCR’s level of success in continuing to attract new customers, sales mix variances, weather and special or unusual events, as well as other risks described more fully in GMCR’s filings with the U.S. Securities and Exchange Commission (the “SEC”). Forward-looking statements reflect management’s expectations as of the date of this press release, and are subject to certain risks and uncertainties. GMCR does not undertake to revise these statements to reflect subsequent developments, other than in its regular, quarterly earnings releases.

Additional Information

This press release is neither an offer to purchase, nor a solicitation of an offer to sell, any securities. The tender offer to purchase shares of Diedrich Coffee common stock referenced in this press release has been made pursuant to a Tender Offer Statement on Schedule TO, containing an offer to purchase, a form of letter of transmittal and other documents relating to the tender offer (the “Tender Offer Statement”), which GMCR and Pebbles Acquisition Sub, Inc., a wholly owned subsidiary of GMCR, filed with the SEC and first mailed to Diedrich Coffee stockholders on December 11, 2009. Security holders of Diedrich Coffee are advised to read the Tender Offer Statement, because it contains important information about the tender offer. Investors and security holders of Diedrich Coffee also are advised that they may obtain free copies of the Tender Offer Statement and other documents filed by GMCR with the SEC on the SEC’s website at http://www.sec.gov. In addition, free copies of the Tender Offer Statement and related materials may be obtained from GMCR by written request to: Green Mountain Coffee Roasters, Inc., Attention: General Counsel, 33 Coffee Lane, Waterbury, Vermont 05676.

GMCR Contacts:

Investor Relations:

Frances G. Rathke, CFO

802-882-2300

Investors:

Okapi Partners LLC

Bruce Goldfarb / Pat McHugh

212-297-0720 or 877-274-8654

Media:

Joele Frank / Dan Katcher

Joele Frank, Wilkinson Brimmer Katcher

212-355-4449

Diedrich Coffee Contacts:

Diedrich Coffee Investor Relations:

Scott Liolios or Cody Slach

Liolios Group, Inc.

Tel 949-574-3860

info@liolios.com