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Parent of Starbucks rival Tully's Coffee files for bankruptcy

The parent company of Tully’s Coffee, the Seattle-based coffee cafe chain that isn’t Starbucks, filed for Chapter 11 bankruptcy this week.

TC Global Inc. said it would close an undisclosed number of its 175 stores in the process. Tully’s has faced “significant challenges that were preventing the company from being profitable,” according to a statement.

Though the filing was a “difficult decision,” TC Global said it was a necessary step in dealing with rising commodity prices and problematic leases.

The company plans to emerge from bankruptcy protection in 2013 and said it expects to “continue to have a formidable presence in the Puget Sound area.” The chain was founded in 1992 and has several locations in Southern California.

The filing doesn’t affect the Tully’s wholesale and online business, which Green Mountain Coffee Roasters bought in 2009.

TC Global filed in the Western District of Washington and has its first hearing Friday.

Peet’s Coffee & Tea Inc., another Starbucks competitor, sold itself this summer to German conglomerate Joh. A. Benckiser for $977.6 million. The Emeryville company had less than 200 stores as of this spring.

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