Pathways Holdings, LLC d/b/a Holland Pathways sued Dianne Seibel in the United States District Court for the District of Kansas, asserting claims related to alleged misappropriation of confidential information and trade secrets. Seibel filed a counterclaim under the Kansas Wage Payment Act (KWPA), and Pathways Holdings moved to dismiss the counterclaim or alternatively strike portions of it.
Factual Overview
From May 2021 until December 2023, Pathways Holdings employed Seibel as a regional clinical director. In March 2024, Pathways Holdings filed suit against Seibel alleging misappropriation of confidential and proprietary information, including trade secrets. Seibel responded by filing an Answer and Counterclaim in June 2024, which she later amended in July 2024. In her counterclaim, Seibel alleged that Pathways Holdings violated the KWPA by withholding her wages, including payment for accrued but unused paid time off. She also alleged that Pathways Holdings acted willfully in violating the KWPA.
Legal Analysis
Motion to Dismiss: The court first addressed whether Seibel’s KWPA counterclaim should be dismissed. Pathways Holdings argued that the counterclaim should be dismissed because Seibel failed to adequately plead that Pathways Holdings acted willfully. The court rejected this argument, explaining that willfulness is not an element of a KWPA claim, but rather is only relevant when determining whether statutory penalties should be assessed. Since willfulness is not required to state a KWPA claim, the court found the motion to dismiss should be denied.
Motion to Strike: The court next considered Pathways Holdings’ alternative request to strike Seibel’s allegation that it acted willfully. The court noted that motions to strike are disfavored and require the moving party to meet a high burden. Pathways Holdings needed to show that the willfulness allegation had no relation to the case or would cause prejudice. The court found that Pathways Holdings failed to meet this burden.
The court denied Pathways Holdings’ motion to dismiss Seibel’s KWPA counterclaim and denied the alternative motion to strike the willfulness allegation.
Schrag on Law 