Eaton Lands Private Review of EU Employee Docs Before IRS Access

Eaton Corp. convinced a federal appeals court to order a private review of its foreign employees’ performance evaluations before their disclosure to the IRS.

The power management business is under investigation for allegedly lowering its US income tax burden by paying inflated royalties to an Irish affiliate, in violation of federal transfer pricing rules. Eaton challenged an Ohio federal court order that it comply with an IRS summons for employee records, arguing on appeal that the court had overlooked European Union data privacy rules.

“We believe a limited remand for in-camera review of the performance evaluations would assist the district ...