Long v. Welch & Rushe, Inc., 8:13-cv-03712

Background

This is a Title VII harassment case in which Linda Long sues Welch & Rushe, Inc. in the District of Maryland.
Plaintiff moves to dismiss the defendant's counterclaims and to strike several affirmative defenses; defendant opposes.
Plaintiff alleges sexual harassment, including advances by the CEO in 2011 and retaliation culminating in her 2012 termination.
Defendant asserts six counterclaims (malicious and negligent defamation, false light, conversion, trespass to chattels, unjust enrichment) tied to alleged misuse of a company card and personal expenses.
Discovery and fact-finding are discussed to determine whether counterclaims are compulsory and whether defenses survive under Twombly/Iqbal standards.
Court ultimately denies the motion to dismiss counterclaims and grants in part and denies in part the motion to strike affirmative defenses.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Are counterclaims IV–VI compulsory under Rule 13(a)?	Long argues they are permissive, not compulsory.	Welch & Rushe contends they arise from the same facts and are compulsory.	Counterclaims IV–VI are compulsory; jurisdiction exists.
Are defamation and false light counterclaims time-barred or privileged?	Statute of limitations bars pre-December 9, 2012 statements; false light relies on three-year statute.	Discovery may reveal post-December 9, 2012 statements; continuing harm doctrine may apply for some claims.	Pre-December 9, 2012 defamation claims time-barred; statements in March 2013 timely; false light governed by three-year statute; absolute privilege issue unresolved at this stage.
Does absolute judicial privilege apply to statements made outside EEOC proceedings?	Statements to support EEOC claims are protected by absolute privilege.	Context unclear; privilege may apply if connected to EEOC proceeding.	Contextual inquiry required; dismissal inappropriate at this stage; privilege not clearly established.
Should Twombly/Iqbal pleading standards apply to affirmative defenses?	Twombly/Iqbal should apply to defenses for fair notice.	Twombly/Iqbal do not apply to affirmative defenses or state-only conclusory defenses.	Twombly/Iqbal apply to affirmative defenses; some defenses struck or require amendment.
Which affirmative defenses are actionable and subject to amendment?	Certain defenses lack factual content and fair notice.	Some defenses can survive with amendment and factual support.	Laches, waiver, and estoppel are stricken; laches inappropriate for Title VII; waiver/estoppel struck; other defenses may amend within 14 days.

Key Cases Cited

Painter v. Harvey, 863 F.2d 329 (4th Cir. 1988) (compulsory counterclaim analysis and the 'same evidence' guideline for Rule 13(a))
Harrison v. Grass, 304 F.Supp.2d 710 (D. Md. 2004) (overlap between Title VII claims and related factual issues)
Allen v. Bethlehem Steel Corp., 76 Md.App. 642 (Md. App. 1988) (statutory limitations for false light and defamation claims in Maryland)
Booth v. Total Health Care, Inc., 880 F.Supp.414 (D. Md. 1994) (absolute privilege considerations in quasi-judicial contexts)
Norman v. Borison, 418 Md. 630 (Md. 2011) (limits of absolute privilege in communications related to quasi-judicial proceedings)
McDonnell Douglas Corp. v. Green, 411 U.S. 792 (Supreme Court 1973) (framework for proving/disproving discriminatory motives in Title VII cases)