Thanks for the additional information. It is helpful. The first thing to investigate would be medical issues. There are medical issues that make a dog become suddenly aggressive. One is pain. Perhaps Martha has some bad teeth and when Jessy bites at her mouth, it causes pain and she reacts. Another could be mouth ulcers or gum disease. It is worth checking at her age. The other condition that might be an issue is hypothyroidism. It can cause sudden aggression and often a dog will have other changes like hair that seems to break off easily, lethargy and possible weight gain. Special test have to be run to rule a thyroid issue out.
Either dog might have that issue so it is possible that both would need to be tested. If they haven't had obedience training, you will want to do that so you can command them to come or sit or perform some other task when you notice that they are getting too tense around each other. You also need to learn how to interpret dog body language so know how close one or the other of them are fed up or aggressive. Read more on that here:
Training doesn't have to be in classes. It just has to be structured. The following site is helpful in helping owners train their dog. Be sure and click on the link to the page on obedience at the bottom. and links on subsequent pages leading to detailed instructions.
Training works best if you train at least 30 minutes a day (two 15 minute sessions). I would start making your dog work via the Nothing in life is free program (NILF). It is outlined below.
The aim isn't to teach the command but to ensure the dog knows the command and obeys immediately even if they don't want to. The daily practice of the same commands over and over help achieve this. Use hot dog slivers as treats since they work really well.
If the fights continue or get worse,you will need to do additional training. Both dogs would be leashed and if one dog even looks at the other dog, a correction should be done. Any sign of aggression including a prolonged look, hair raised on the shoulders, a growl or even a stiff legged walk, should be corrected. A correction is a quick tug of the leash and a firm low toned "NO". Once you have done this couple of times, you should notice the dogs ignoring each other. When that happens, you will want to reward them for the desired behavior. Again, use tasty treats like the hot dog slices. This teaches the dogs that you WILL not tolerate fighting in YOUR pack.
Since you seem to know the triggers, try and stop that behavior before the fight starts. With the training to allow you more control and the behavior modification, you should see improvement pretty quickly.
Try not to pick up the little one, instead use the leash. When you pick her up, she is getting attention from you, this might actual cause her to act up more. If there is an alpha which sounds like it is Jessy if she is the pushy one, you need to treat her special. Feed her first, give her treats first and give her attention first. If you give the lower ranking dog attention first that can actually trigger the more dominant dog to reprimand the other dog.
Since they have not drawn blood it is likely a situation that can be calmed down pretty quick. I wouldn't waste any more money on diffusers as they are useless for aggression. They are effective for anxieties like noise phobias, car avoidance, and separation anxiety.
I hope this information is helpful to you. If you would like any additional information or have more questions please don’t hesitate to press the reply to expert or continue conversation button so I can address any issues you still have . If you do find this helpful, please take this opportunity to rate my answer positively so I am compensated for my time.