Al Ladin, attorney for Spray Lawn, Inc., suspected that two of Spray Lawn's lower-echelon employees were diverting the corporation's funds to their own use. Ladin confronted the employees with his suspicions, and they both confessed. At Ladin's insistence, the employees wrote a detailed account of their activities involving the diversion of company funds. Their employment was then terminated. Subsequently, the IRS conducted an audit of Spray Lawn, Inc. and issued a summons for the employees' written statements in Ladin's possession.
Ladin must produce the statements because a summons issued by a government agency must be enforced by a court of law.
Ladin may lawfully refuse to produce the statements on the basis of the attorney-client privilege.
Ladin may lawfully refuse to produce the statements on the basis the summons relates to a personnel decision.
Ladin must produce the statements because they provide relevant information necessary to conduct an audit of Spray Lawn for the purpose of enforcing the nation's tax law.