Equal Employment Opportunity Commission v. Sidley Austin Brown & Wood

Sidley Austin Brown & Wood (Sidley) (defendant) was a law firm with over 500 partners. In 1999 Sidley demoted 32 equity partners (collectively, the demoted partners) to counsel or senior-counsel positions. The Equal Employment Opportunity Commission (EEOC) (plaintiff) opened an investigation into the demotions to determine whether Sidley violated the Age Discrimination in Employment Act (ADEA). The ADEA protected employees from age-based discrimination by employers. The ADEA did not, however, protect employers. The reasoning behind this differential treatment lay in the ability of employers to protect themselves from discrimination by participating in management decisions. Sidley argued that before their demotions, the demoted partners were employers under the ADEA because they were partners in the law firm. As partners, the demoted partners shared in the firm’s profits and were liable for the firm’s debts. The EEOC believed that the demoted partners may have been employees because of Sidley’s governance structure. Sidley was controlled by an executive committee made up of 36 partners. The committee had the power to fire, demote, and promote partners, as well as alter their compensation structures. None of the demoted partners were on the executive committee. To determine whether the demoted partners were employers or employees, the EEOC issued a subpoena to Sidley to produce relevant documents related to whether the ADEA covered the demoted partners and whether Sidley discriminated against the demoted partners. Sidley did not produce all the requested documents. The EEOC asked the district court to enforce the subpoena, and the district court ordered Sidley to comply with the subpoena. Sidley appealed.