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The marketing division of a company is at a trade show cocktail party in Kansas City. After five martinis, a representative of Company 1 lets it slip that his company is planning on dropping out of one market and raising prices in another. Also intoxicated, a representative of Company 2 says, “Well, if you do that…our company will likely drop the market in which you are raising prices, and will probably increase prices where you are withdrawing. It just makes sense…” Five months later after each company has withdrawn from one market and increased prices in the other, Company 1 launches a routine, internal self-audit conducted by counsel. During the investigation, the marketing employee mentions to counsel that he got a little tipsy at the last trade show and mentioned to his friends that the company would be withdrawing from market A and increasing prices in market B. The lawyer later discovers that the competitor company has increased their prices in market A, and withdrawn from market B, exactly as discussed at the trade show. Shortly thereafter, the Federal Trade Commission (FTC) launches an investigation on the loss of competition and the increase of prices in both markets. The corporation the attorney represents has strong internal ethics policies and wishes to disclose its findings to the FTC, but fears that disclosing such information to the government will result in litigation brought by the distributors who buy the corporation’s products. Can the lawyer make the disclosure to the FTC without waiving the attorney-client privilege that adheres to his communications with the marketing representative if such communications are sought by the distributors? … Read the full text …