According to the EEOC, Fry suggested that the lack of millennials was a problem, and the Indianapolis-based company would target 40% "Early Career" hiring.
Managers then changed their hiring practices for sales representatives, sometimes requiring greater review and approval before extending offers to older candidates, even after some recognized that the 40% goal was illegal, the EEOC said. The target remained through 2021, it added.
Lilly, in a statement, denied the accusations and said it was "committed to fostering and promoting a culture of diversity and respect."
The lawsuit filed in Indianapolis federal court accused Lilly of violating the federal Age Discrimination in Employment Act.
It seeks to permanently enjoin future discrimination, obtain back pay and other damages for people not hired because of their age, and improve training for supervisors and managers.
"This case underscores the continued need for the EEOC to break down barriers to employment" for older Americans as they work longer and in larger numbers, Robert Weisberg, an EEOC lawyer who helped bring the case, said in a statement.
Lilly's top-selling product is Trulicity, a treatment for type 2 diabetes.
On Aug. 11, Lilly said Fry would retire at the end of 2022 after more than 35 years at the company.
The case is EEOC v Lilly USA LLC, U.S. District Court, Southern District of Indiana, No. 22-01882.
(Reporting by Jonathan Stempel in New York; Additional reporting by Dan Levine in San Francisco; Editing by Stephen Coates)
By Jonathan Stempel