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. 10)

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

President and 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. 10 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, Amendment No. 2, Amendment No. 3, Amendment No. 4, Amendment No. 5, Amendment No. 6, Amendment No. 7, Amendment No. 8 and Amendment No. 9 to the Solicitation/Recommendation Statement on Schedule 14D-9 filed by Diedrich with the SEC on December 31, 2009, January 11, 2010, January 14, 2010, January 28, 2010, February 8, 2010, March 9, 2010, March 15, 2010, April 6, 2010, and May 3, 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 in the section entitled “Background of the Offer”:

On May 10, 2010, the FTC closed its investigation concerning the Offer and the Merger, concluding that no further action by the FTC is warranted at this time.

Item 8. Additional Information.

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

The FTC closed its investigation concerning the Offer and the Merger on May 10, 2010, concluding that no further action by the FTC is warranted at this time. With this closure, all necessary approvals of the Offer and the Merger under the HSR Act were obtained.

The full text of the press release issued by GMCR on May 10, 2010, announcing the closure of the FTC investigation is filed as Exhibit (a)(15) hereto and is incorporated herein by reference.

Item 8 of the Schedule 14D-9 is hereby further amended and supplemented by adding the following after the last paragraph in the section entitled “Litigation”:

In connection with the settlement of the litigation, Diedrich, the members of the Board, GMCR, Purchaser and the plaintiff entered into a Stipulation and Agreement of Compromise, Settlement and Release, dated May 10, 2010 (the “Stipulation”). The terms of the proposed settlement are set forth in the Stipulation and include Diedrich providing notice to Diedrich’s stockholders of the settlement of the litigation. Accordingly, the following notice is hereby provided. This notice should be read in conjunction with the text of the Stipulation, which was filed with the Court on May 10, 2010.

NOTICE OF SETTLEMENT OF CLASS ACTION

TO: ALL CURRENT SHAREHOLDERS OF DIEDRICH COFFEE, INC. (“DIEDRICH” OR THE “COMPANY”) COMMON STOCK AS OF MAY 11, 2010.

PLEASE TAKE NOTICE that the class action (the “Action”), entitled Mendenhall v. Phillips et al., Case No. 30-2009-00318976 is being settled and the parties have entered into a Stipulation of Settlement dated May 10, 2010 (the “Stipulation”). The terms of the proposed settlement of the Action (the “Settlement”) are set forth in the Stipulation. This notice should be read in conjunction with, and is qualified in its entirety by reference to, the text of the Stipulation, which has been filed with the Court. The terms of the Settlement set forth in the Stipulation include: (i) Diedrich issuing certain supplemental disclosures that were negotiated and agreed upon by and between Diedrich and Plaintiff George Mendenhall, on behalf of himself and all stockholders of Diedrich; and (ii) the agreement of J. Russell Phillips, Timothy Ryan, Gregory Palmer, James Stryker, Paul Heeschen, Diedrich, Green Mountain Coffee Roasters, Inc. and Pebbles Acquisition Sub, Inc. to not oppose Plaintiff’s application for fees and expenses in the aggregate of no more than $350,000.

IF YOU ARE A CURRENT OWNER OF DIEDRICH COMMON STOCK, YOUR RIGHTS MAY BE AFFECTED BY PROCEEDINGS IN THE LITIGATION.

A hearing (the “Preliminary Settlement Hearing”) shall be held on May 21, 2010 at 1:30 p.m. in the Superior Court of the State of California for the County of Orange, Civil Complex Center, located at 751 West Santa Ana Boulevard, Santa Ana, California 92701, to establish a schedule for the holding of a final settlement hearing (the “Final Settlement Hearing”).

The Court may adjourn the Preliminary Settlement Hearing or any adjournment thereof, including the consideration of the application for attorneys’ fees and reimbursement of expenses, without further notice of any kind other than oral announcement at the Preliminary Settlement Hearing or any adjournment thereof.

A further hearing, the Final Settlement Hearing, will be held in the Superior Court of the State of California for the County of Orange, Civil Complex Center, located at 751 W. Santa Ana Boulevard, Santa Ana, California 92701 to: (i) determine whether final approval of the Settlement should be entered as fair, reasonable, and adequate and in the best interests of the Class; (ii) determine whether judgment should be entered pursuant to the Stipulation, inter alia, extinguishing and releasing all Settled Claims (as defined in the Stipulation); (iii) determine whether the Class should be certified and whether the Class representative and his counsel have adequately represented the Class; (iv) rule on an application of Plaintiff’s counsel for an award of attorneys’ fees and expenses; and (v) rule on such other matters as the Court may deem appropriate. The date and time of the Final Settlement Hearing shall be disclosed on the worldwide website of GMCR at www.GreenMountainCoffee.com and on the worldwide website of Diedrich at www.diedrich.com.

The Court may reserve the right to approve the Settlement with or without modification, to enter a Final Judgment, and to order the payment of attorneys’ fees and expenses without further notice of any kind.

Any member of the Class who: (a) objects to the (i) Settlement, (ii) class action determination, (iii) adequacy of representation of Plaintiff and his counsel, (iv) judgment to be entered with respect to the Action, and/or (v) the request for fees and/or reimbursement of costs and expenses by counsel for the Plaintiff; or (b) otherwise wishes to be heard, may appear in person or through counsel at the Preliminary Settlement Hearing and/or the Final Settlement Hearing and show cause why the Settlement should not be approved. If you want to do so, however, you must, not later than five (5) calendar days prior to the Preliminary Settlement hearing or ten (10) calendar days prior to the Final Settlement Hearing (unless the Court in its discretion shall otherwise direct for good cause shown), file in the Superior Court of the State of California for the County of Orange, Civil Complex Center, located at 751 W. Santa Ana Boulevard, Santa Ana, California 92701: (i) a written notice of intention to appear; (ii) proof of membership in the Class; (iii) a statement of your objections to any matters before the Court; and (iv) the grounds for your objection or the reasons for your desiring to appear and be heard, as well as documents or writings you desire the Court to consider. Also, on or before the date you file such papers, copies of such papers must be served on and received by each of the following attorneys of record:

Juan E. Monteverde, Esq.

Levi & Korsinsky LLP

30 Broad Street, 15^th Floor

New York, New York 10004

Wayne W. Smith, Esq.

Gibson, Dunn & Crutcher LLP

3161 Michelson Drive

Irvine, California 92612

Thad A. Davis, Esq.

Ropes & Gray LLP

Three Embarcadero Center

San Francisco, California 94111

If you do not object to the Settlement, the class action determination, or the request by counsel for the Plaintiff for an award of attorneys’ fees and expenses, you do not need to do anything at this time.

You cannot be heard at either the Preliminary Settlement Hearing or the Final Settlement Hearing unless you serve and file written objections in the manner described above.

Any person who fails to object in the manner described above shall be deemed to have waived the right to object (including the right to appeal) and will be forever barred from raising such objection in this or any other action or proceeding.

Inquiries may be made to Plaintiff’s Counsel: Juan E. Monteverde, Levi & Korsinsky, LLP, 30 Broad Street, 15th Floor, New York, New York 10004.

DATED: May 11, 2010

BY ORDER OF THE COURT

SUPERIOR COURT OF CALIFORNIA

FOR THE COUNTY OF ORANGE

Item 8 of the Schedule 14D-9 is hereby further amended and supplemented by adding the following immediately before the section entitled “Forward-Looking Statements”:

Completion of the Offer and Merger

The Offer expired at 12:00 midnight, Eastern Time, on Monday, May 10, 2010 (one minute after 11:59 p.m., Eastern Time, on May 10, 2010). The depositary for the Offer advised GMCR and Purchaser that, as of the expiration time of the Offer, approximately 5,446,334 shares of Common Stock were validly tendered and not properly withdrawn pursuant to the Offer, which represented approximately 95.06% of all outstanding shares of Common Stock. Purchaser has accepted for payment all shares that were validly tendered and not properly withdrawn, and payment for such shares has been made in accordance with the Offer’s terms.

GMCR and Purchaser then effected the Merger on May 11, 2010, as a “short form” merger, in accordance with the terms of the Merger Agreement and Delaware law.

The full text of the press release issued by GMCR on May 11, 2010, announcing the completion of the Offer and Merger is filed as Exhibit (a)(16) hereto and is incorporated herein by reference.

Item 9. Exhibits.

Item 9 is supplemented by adding the following exhibit:

Exhibit	Description
(a)(15)	Press Release issued by GMCR on May 10, 2010.
(a)(16)	Press Release issued by GMCR on May 11, 2010.

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: May 11, 2010

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

EX-99.(A).(15)

Exhibit (a)(15)

For Immediate Release

GREEN MOUNTAIN COFFEE ROASTERS, INC. ANNOUNCES HSR CLEARANCE

FOR THE ACQUISITION OF DIEDRICH COFFEE

WATERBURY, Vt., May 10, 2010 — Green Mountain Coffee Roasters, Inc. (NASDAQ: GMCR) (“GMCR”) today announced that the Federal Trade Commission has closed its investigation concerning GMCR’s tender offer for Diedrich Coffee, Inc. (NASDAQ: DDRX) (“Diedrich Coffee”). With this closure, all necessary approvals of the tender offer under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 have been obtained. The tender offer is scheduled to expire at midnight, New York City time, on Monday, May 10, 2010, and is not expected to be extended further.

The Board of Directors of Diedrich Coffee has recommended that Diedrich Coffee stockholders tender their shares into the tender offer. Questions and requests for assistance regarding the tender offer may be directed to the Information Agent for the offer, Okapi Partners LLC, toll-free at (877) 274-8654.

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

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 Purchaser 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:

Suzanne DuLong, VP Investor Relations & Corporate Communications

(802) 882-2100

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

EX-99.(A).(16)

Exhibit (a)(16)

GMCR Contact Information:

Media:

Joele Frank / Dan Katcher

Joele Frank, Wilkinson Brimmer Katcher

212-355-4449

Diedrich Investors:

Okapi Partners LLC

Bruce Goldfarb / Pat McHugh

212-297-0720 or 877-274-8654

GMCR Investors:

Investor.Services@GMCR.com

GREEN MOUNTAIN COFFEE ROASTERS, INC. ACQUIRES

DIEDRICH COFFEE, INC.

Waterbury, Vt., May 11, 2010 – Green Mountain Coffee Roasters, Inc. (NASDAQ: GMCR) (“GMCR”) today announced that it has acquired Diedrich Coffee, Inc. (NASDAQ: DDRX) (“Diedrich Coffee”) for $35 per share of common stock in cash, pursuant to a cash tender offer and a “short form” merger, in a transaction with a total value of approximately $300 million.

GMCR’s tender offer for all outstanding shares of Diedrich Coffee common stock expired at midnight, Eastern Time, on Monday, May 10, 2010. As of the tender offer’s expiration time, approximately 5,446,334 shares had been tendered and not properly withdrawn pursuant to the tender offer, which represented approximately 95.06% of the outstanding shares as of the tender offer’s expiration date. GMCR and the wholly owned subsidiary through which it conducted the tender offer, Pebbles Acquisition Sub, Inc. (“Purchaser”), accepted for payment all shares that were validly tendered and not properly withdrawn, and paid for these shares in accordance with the tender offer’s terms.

Subsequent to the tender offer, GMCR effected the merger of Purchaser with and into Diedrich Coffee, with Diedrich Coffee being the surviving corporation, on May 11, 2010. As a result of the merger, Diedrich Coffee has become a wholly owned subsidiary of GMCR.

Lawrence J. Blanford, President and Chief Executive Officer of GMCR, said, “We are pleased to welcome Diedrich Coffee to the GMCR family. We believe this combination provides significant growth opportunities and further advances GMCR’s objective of becoming a leader in the coffee and coffeemaker businesses.”

Blanford continued, “By taking the next logical step beyond our already successful licensing agreement with Diedrich Coffee, we are bringing in house three strong, complementary brand platforms – Diedrich, Gloria Jean’s and Coffee People – and augmenting the growing GMCR beverage brand portfolio. In addition, we are gaining manufacturing and distribution facilities in California, which will enable us to more effectively reach consumers in this region.”

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 will be integrated into GMCR’s Specialty Coffee business unit. The combined company will operate manufacturing and distribution facilities in Waterbury and Essex, Vermont; Castroville, California; Knoxville, Tennessee; Sumner, Washington; and Toronto, Ontario Canada.

As previously announced, GMCR anticipates that this transaction will be neutral to slightly accretive within the first twelve months following the close, excluding one-time transaction expenses, and accretive thereafter.

GMCR also announced that it has amended its Amended and Restated Revolving Credit Agreement to provide for a new term loan for $140 million, a new uncommitted revolver increase option of up to $100 million and increases in the permitted amounts of certain forms of indebtedness and investments. In connection with the closing, GMCR executed the $140 million new term loan to pay for a portion of the Diedrich Coffee acquisition purchase price.

As of the close of trading on May 11, 2010, Diedrich Coffee’s common stock will no longer be traded on the NASDAQ Stock Exchange.

BofA Merrill Lynch is serving as financial advisor to GMCR on this transaction and Ropes & Gray LLP is serving as its 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 Green Mountain Coffee^®, Newman’s Own^® Organics coffee, Tully’s 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 and brands, 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 Services section of its website, including news releases and its complete financial statements, as filed with the SEC. The Company encourages investors to consult this section of its website regularly for important information and news. Additionally, by subscribing to the Company’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. 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 and producing 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.