Case 1
Insider Trading

Purpose: This case discusses a new and potentially alarming trend in the area of illegal insider trading. The Internet is giving people a false sense of anonymity which does not discourage them from sharing private corporate information. This case also makes students aware of how easy it is becoming to gain access to illegal inside information and how to avoid breaking securities law when the information comes to them.

1. This question is not as straightforward as it may seem on the surface. But an acceptable definition is as follows: Information becomes public when a company representative officially makes an announcement via a major media.

2. Absolutely anyone can come into contact with inside information. You do not have to work for the firm to have private information. In fact, it seems that private information is often readily volunteered these days.

3. If someone conveys to you information that could be useful in making buy or sell decisions, that information would be illegal to trade upon. Private information only becomes illegal trading when (1) you actually trade on the information, or when (2) you convey the information to someone else and they trade on the information. No matter how long the chain of passing along information gets, if you are identified as one of the links in the chain, in the eyes of the court you are just a guilty as the one who eventually trades.

4. For some reason people think the Internet is a secure place to discuss secretive issues. Despite reports that your employer monitors your e-mail and Internet usage, and despite the fact that the persons responsible for sending out the “I love You” virus were tracked down on the other side of the world in a matter of days, people still think there is no way to learn of the Internet user’s identity.

5. If you come in contact with non-public information, the best thing to do is ignore it. You can’t help what you hear, but you can control what you do, or do not do, with the information. Case 2
The Tobacco Industry

Purpose: Everyone knows that ethics are a part of business decision making. In classroom discussions, students find the unethical hypothetical debate to be rather clear-cut. However, in the real world, when ethical decisions hurt one party to help another, there are no easy answers. This case centers around the tobacco industry's alleged increase in nicotine levels in cigarettes in an attempt to induce addiction amongst smokers. This case also addresses the government's role in regulating smoking in the work place. Ethics questions are possibly the most difficult to answer. One must consider all sides of the argument and attempt to remain objective. Instead of stating my personal opinions, I will try to objectively present both sides of each argument.

1. Any time a consumer purchases a product he/she has a right to know the ingredients of the product. If tobacco companies alter nicotine levels (either with the intent to induce addiction or without) without notifying consumers, most people feel this would be extremely unethical.

2. As long as customers know what they are smoking, the practice of providing high or low nicotine cigarettes is generally deemed acceptable by most. The alcoholic beverage industry sells various types of beers based on the level of alcohol or the fullness of the beer, etc. Hence, it is reasonable to allow tobacco firms to market different strengths of cigarettes. Since nicotine is argued by the tobacco industry to be the source of flavor, cigarette manufacturers could easily justify the need for various nicotine levels.

3. Fine print warnings on the side of cigarette packs have been frowned upon because they are hard to notice and even harder to read. Most people do not read their