Labor & Employment Law Daily Wrap Up, RETALIATION—D. Md.: Sales executive, fired after complaining of ‘frat house’ atmosphere, partially advances claims, (Feb 23, 2026)

By Todd Harrison, J.D.

Although the employer asserted in its Form 8-K filing that the termination was not for cause and occurred because of a restructuring, it subsequently asserted that the decision was performance-based.

Denying an employer’s motion for summary judgment against the retaliation claims asserted by a former sales executive, a federal district court in Maryland determined that a reasonable factfinder could find that the decision to terminate the employee was made one to two months after he engaged in protected activity and that he also submitted relevant evidence beyond temporal proximity. Although the court initially declined to grant the employee’s motion for summary judgment against the employer’s claims that he misappropriated trade secrets, it did find the employee successfully asserted an immunity defense and granted summary judgment on those grounds. As to the employee’s retaliation counterclaim based on the employer’s filing of a lawsuit, the court found summary judgment in the employer’s favor was warranted (Rozdilsky v. Liquidity Services, Inc., Nos. 22-3355-TDC and 23-1653-TDC (D. Md. Feb. 20, 2026)).

The employee in this case is a white man who was the highest-ranking marketing executive in the employer’s company. In this role, he reported directly to the company’s CEO.

Complaints. During his tenure at the company, the employee asserted that he had raised complaints to the executive team and the Board of Directors that the CEO and other employees had engaged in the mistreatment of, and discrimination against, female and minority employees, both systematically and in individual instances, decrying the company’s “frat house” environment.

In addition to these complaints, the employee raised objections to the CEO’s demands that it stop advertising on the website of Al Jazeera, asserting that doing so “looks kind of racist.”

Termination. On August 13, 2021, the employee was informed that he was being terminated. The CEO purportedly told him that the company was moving in a new direction. In its Form 8-K filing with the SEC, the employer asserted that the employee was fired without cause due to a new organizational structure in which his position was eliminated. However, in his deposition, the CEO stated that the employee was fired for performance reasons.

Document retention. Shortly after his termination, the employee was informed that he was being replaced by a Black man. The employee asserted that at this point he believed the termination decision may have been motivated by race discrimination. As such, he decided he needed evidence to support this claim. Before returning his laptop to the company, he used his cellphone to take and retain photos and videos of approximately 480 pages of documents. There was no evidence that the employee gave the photographs to anyone outside of the company other than his attorney and the EEOC.

Lawsuits. Subsequently, the employer filed a complaint alleging that the copying and retention of materials from the employee’s laptop constituted a breach of contract and was in violation of both the Defend Trade Secrets Act (DTSA) and the Maryland Uniform Trade Secrets Act (MUTSA). The employee then filed suit alleging race discrimination and unlawful retaliation. The court granted a motion to consolidate the two actions.

In answering the employer’s amended complaint, the employee asserted a counterclaim against the employer alleging that the filing of its lawsuit constituted unlawful retaliation for his filing of discrimination and retaliation claims with the EEOC.

Here, the employer sought summary judgment only as to the employee’s retaliation claims and to his counterclaim. The employee sought summary judgement on all claims.

Protected activity. First addressing the employee’s retaliation claim, the court looked to whether the employee had engaged in protected activity and whether that protected activity was causally connected to his termination. The employee asserted that he engaged in protected activity by complaining on multiple occasions about the company’s treatment of female and minority employees, as well as disagreeing with the decision to remove advertising from Al-Jazeera’s website.

With regard to the ads on Al-Jazeera, the court found that the disagreement between the employee and the CEO did not constitute protected activity because the employee could not reasonably be deemed to be opposing employment discrimination.

As to his complaints of individual acts of discrimination taken against other employees, the court found no evidence that he directly or indirectly told the CEO that he believed such acts were discriminatory, and thus those complaints were not protected activity. However, the court reached a different conclusion in the employee’s complaints of systemic race and sex discrimination, noting that he had told the chief HR officer that the sales team was like a “frat house.” Such a report to senior management of discriminatory treatment of female employees qualified as protected activity under Title VII, said the court.

Causation. Turning to the issue of causation, the employer contended that there was no evidence the employee’s complaint to HR was ever conveyed to the CEO prior to his decision to terminate the employee. However, the employee asserted that the HR officer told him she was going to speak with the CEO and that she had, in fact, done so, but the topic made her “uncomfortable.” The employer also asserted that even if the CEO was aware of the protected activity, the five-month gap between the employee’s last protected activity in March 2021 and his termination was insufficiently close to support an inference of causation.

According to the CEO’s deposition testimony, he had decided to terminate the employee “in the April to July time frame” in 2021. Thus, the court determined that a reasonable factfinder could conclude that the decision to terminate the employee was made one to two months after his last protected activity. Further, the court noted that the employee was not relying on temporal proximity alone in stating his claim for retaliation. He also pointed to evidence of inconsistent stated reasons for his termination. Accordingly, the court denied the employer’s motion for summary judgement against the employee’s retaliation claim.

Misappropriation. Next, the court considered the employee’s motion for summary judgment on all of the employer’s claims of misappropriation of trade secrets under the DTSA and the MUTSA, and its breach of contract claim as related to the employee’s signed confidentiality agreement.

Trade secrets. Here, the employee argued that summary judgment against the DTSA and MUTSA claims was warranted because much of the information he copied from his laptop did not meet the definition of “trade secret” under either statute. The court was not persuaded, finding some of the documents met the requisite definition. As such, the court denied the employee’s motion for summary judgment on these grounds.

Immunity provision. The employee also argued that he was entitled to summary judgment because the evidence undisputedly established that his actions fell within an exception to the DTSA, barring liability.

On this point, the court agreed, noting that although some of the retained documents could “theoretically be relevant to some purpose other than to support a discrimination claim,” the employer had identified no alternative purpose for the copying and retention of the documents. Thus, where the employer failed to provide evidence showing that the employee had retained these documents for some purpose other than to report or investigate a suspected violation of the law, the court granted the employee’s motion for summary judgment against the DTSA and MUTSA claims based on the DTSA’s immunity provision.

Breach of contract. Turning to the employee’s motion for summary judgment against the employer’s breach of contract claim as it related to a signed confidentiality agreement, the court determined that his retention and disclosure of materials was in fact protected by that very agreement. As noted, there was no evidence that the employee retained or disclosed information from his laptop for any reason other than to advance his claims of discrimination and retaliation. Thus, the court determined that the agreement’s provision precluded a determination that the agreement barred the employee’s actions, because doing so would have limited and restricted his ability to cooperate with the EEOC’s activities. Accordingly, the court granted the employee’s motion for summary judgment on this claim.

Counterclaim. Finally, the court addressed the employee’s counterclaim that the employer filed its complaint in retaliation for the employee’s EEOC complaint. Although the employee argued that the DTSA immunity provision applied because his use of the materials was limited to submitting the records for use by his attorney, the court noted that this provision was an affirmative defense and, at the time of filing, the employer was not required to accept the employee’s explanation for his apparent violations of law at face value. Because the employee could not establish that the employer’s suit lacked a reasonable basis in fact or law with no realistic chance of success at the time it was filed, it could not constitute an act of unlawful retaliation. Thus, the court granted the employer’s motion for summary judgment against this claim.

The case is Nos. 22-3355-TDC and 23-1653-TDC.

Judge: Chuang, T.

Attorneys: Eric Bachman (Bachman Law) for Nicholas Rozdilsky. Leslie Paul Machado (O'Hagan Meyer) for Liquidity Services, Inc.

Companies: Liquidity Services, Inc.

Cases: Retaliation ContractClaims CoverageLiability Discharge Discrimination RaceDiscrimination StateLawClaims MarylandNews