Question

The Association for Innovative Technology (AIT) is a trade group funded largely by Sungard Corporation. During Sungard’s antitrust trial, AIT was active in public relations as it worked to convince everyone from the public to members of Congress that the antitrust case would thwart innovation in computers, software, and their uses. Joseph H. Feldman, chairman of Phoenix Corporation, a software manufacturer and fierce Sungard competitor, was concerned that the public might not understand that AIT was funded by Sungard and was not truly an independent group. Through Phoenix, Mr. Feldman hired Privacy Services (PS), a private investigation firm, to find information tying Sungard to AIT. Mr. Feldman described his hiring of PS as his “civic duty.” Shortly after PS was hired by Phoenix, janitors working the night shift at the offices of AIT were offered $75-$80 each by Rosa Garcia, a woman working for PS, if they would turn over AIT’s trash to her rather than dumping it. The janitors refused, and Ms. Garcia returned the next evening and offered them $600 each for the trash plus $400 extra to the supervisor if he could convince the janitors to cooperate. All of the staff declined the money. Ms. Garcia left them her card, explaining that she was working on a criminal case, and asked them to call if they changed their minds. When the janitors disclosed what had happened, the investigator was traced back to Mr. Feldman who said, “All we did was to try to take information that was hidden and bring it into the light. I don’t think that’s arrogance. That’s a public service.” Do you think what Phoenix, Mr. Feldman, and Ms. Garcia did was ethical? What ethical issues are raised by this case? What ethical model would you use to analyze the case?

Answer 1

In this particular case, what Chairman of Phoenix, the most aggressive competitor of AIT did was not only unethical but also illegal. Whenever an organisation's rival introduces similar products and performs practises to get internal, confidential and sensitive information by means of bribery , pressurizing in the of position or extortion, this comes under the act of Industrial Espionage and it can have extreme consequences for the organisations directly involved. Feldmans use of Privacy services to seek sensitive information which could possibly lead to the detriment of the AIT is an illegal act.