## Facts

- P. Larue Simpson worked for a large accounting firm that became part of Ernst & Young through a merger and was discharged in 1990 while over age 40.
- Simpson alleged his discharge was motivated by age discrimination and by a desire to prevent him from obtaining or enjoying post-merger retirement benefits.
- He asserted federal claims under the Age Discrimination in Employment Act (ADEA) and ERISA, along with an Ohio age-discrimination claim and an unjust enrichment claim.
- Ernst & Young contended Simpson was a “partner,” not an “employee,” and therefore was outside the coverage of the ADEA and ERISA’s employee-protective provisions.
- The district court treated the “partner” label as non-dispositive and focused on Simpson’s actual role in management, control, and ownership.
- A jury found age was a determining factor in Simpson’s discharge and that the ADEA violation was willful, resulting in damages including liquidated damages.
- Ernst & Young appealed, challenging employee status and the sufficiency of the evidence supporting liability and willfulness.

## Issues

1. Whether Simpson was an “employee” covered by the ADEA and ERISA, despite being labeled a “partner” by the firm.
2. Whether the evidence supported the jury’s findings that age was a determining factor in the discharge and that the ADEA violation was willful.
3. Whether the ERISA interference/retaliation theory and related Ohio age-discrimination claim could stand given the employee-status dispute and evidentiary challenges.

## Decision

- The Sixth Circuit affirmed the judgment for Simpson.
- The court approved a functional, fact-intensive analysis of whether a person labeled a “partner” is actually an “employee” for ADEA and ERISA purposes and upheld the conclusion that Simpson was an employee.
- The court held the evidence permitted a reasonable jury to find that age was a determining factor in Simpson’s discharge.
- The court upheld the jury’s finding of willfulness and the resulting liquidated damages under the ADEA.
- Judge Daughtrey concurred, emphasizing that modern large professional firms may confer “partner” titles without meaningful ownership or control.

## Legal Principles

- Statutory “employee” status under the ADEA and ERISA is not determined solely by a firm’s title or formal designation; courts look to the actual relationship.
- Relevant factors for distinguishing a true partner from an employee include real participation in management and policymaking, authority over personnel decisions, financial risk and profit/loss exposure, liability exposure, and the degree of supervision or subordination.
- In ADEA cases, age need not be the sole reason for discharge; liability may be shown where age is a determining factor, proved by direct or circumstantial evidence.
- Willfulness under the ADEA is supported where the employer knew, or acted in reckless disregard of whether, its conduct was prohibited, justifying liquidated damages.
- ERISA protection against benefit-interference and retaliation may apply where an individual qualifies as an employee and the evidence supports an inference that termination was aimed at preventing benefit attainment or punishing benefit-related inquiries.

## Conclusion

The Sixth Circuit sustained a jury verdict finding willful age discrimination, holding that “partner” status in a large professional firm does not bar ADEA and ERISA coverage when the individual’s actual authority, control, and ownership interests are consistent with employee status.


Simpson v. Ernst & Young, 100 F.3d 436 (6th Cir. 1996)