We asked the teacher for a meeting two weeks ago. She left a message saying she didn't want to have the meeting after school but she would discuss it by phone. His parents did not go for that. I don't believe you should keep a first-grader back if he's capable of doing his work. Why won't the school somehow make him complete his daily work? Thanks.
It's also possible that this little boy has a hearing loss. He may be able to understand you and his parents at home, but in a noisy environment, he may be having trouble hearing what the teacher is saying. Please have his hearing checked right away.
If his hearing is okay, he may have what's called an auditory processing problem. This is a kind of learning disability that makes it difficult to understand spoken language, even when there is no problem with hearing. Your grandson may not be doing work that he's capable of doing because he doesn't understand what to do after he writes his name. Does he act this way for all activities? Does he seem to listen and respond when it's time for music? Does he appear to process language that he hears from the other kids while he's on the playground? He could have ADD without the hyperactive component, and he may very well be having trouble paying attention and staying focused on his work. It's important to rule this in or out, especially if the teacher believes this is the cause of his problems.
Since you say he's a good reader in first grade, he might also be a very bright little boy who doesn't want to do the work in school because it's boring! You may want to request an evaluation to find out more about his learning strengths and weaknesses.
How is your grandson's relationship with this teacher? Does he feel that she likes him and cares about him? When she interacts with him, is she encouraging and positive, or is she frustrated and upset with him? This may sound strange, but it could be that he's shutting down to have some control over her. Have the school psychologist pay a visit with these questions in mind.