Mr. Red is on the Board of Directors of XYZ Corp. XYZ Corp. is an airline carrier and is a publicly traded corporation. The President of XYZ Corp. is Mr. Blue. Mr. Blue has been in his position for 10 years. Mr. Blue is well respected throughout the aviation industry as well as the financial markets for his stewardship of XYZ Corp. He is widely credited for successfully managing the company through the recent pandemic as well as several recent mergers that have significantly increased the profitability of the company.

Mr. Blue recently disclosed to the Board that he expects to be arrested very soon for tax fraud by the US Government. As a result, the Board of Directors expects that Mr. Blue will be forced to resign his position or be fired.

That evening, while having dinner with his wife (Mrs. Purple), Mr. Red told his wife about the circumstances surrounding Mr. Blue. Mr. Red had at times in the past told his wife about events surrounding the company because he trusted and valued his wife's advice.

Later that evening, Mrs. Purple telephoned her best friend, Mrs. Rock. Mrs. Rock and her husband had recently experienced some financial difficulties because Mr. Rocks had been laid off from his job. During the course of the conversation, Mrs. Purple repeated the story about Mr. Blue and suggested that someone with this information could make some money before it became public.

The next day Mrs. Rock telephoned her stock broker and told the broker to acquire $100,000 worth of XYZ Corp. "short". ("Short" investors investors act in this way when they expect the price of a stock to fall).

A few days later publicity began to appear regarding Mr. Blue's personal (tax) situation. A reporter from the Wall Street Journal called Mr. Red and asked him if the rumors about Mr. Blue were true. Mr. Red replied "These rumors are completely untrue!".

Five (5) days later, Mr. Blue was arrested and was immediately fired by the Board of Directors. The news made headlines in the financial and aviation industries. The price of XYZ's stock dropped 18%. Mrs. Rock made a large profit on her stock trade. Other investors are very unhappy.

Discuss all potential liability. In your answer you should be certain discuss the potential parties and cause(s) of action, elements of proof, and the likelihood of success.