In the case of Lynn Black, how should she proceed after discovering material nonpublic information?

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In the context of Lynn Black discovering material nonpublic information, the appropriate action is to inform her supervisor of her discovery. This is because it aligns with ethical standards and regulatory requirements regarding insider information. When someone comes across material nonpublic information, it is crucial to handle it responsibly to maintain the integrity of the financial markets and to comply with laws such as the Securities Exchange Act.

By informing her supervisor, Lynn allows for appropriate measures to be taken within the organization, ensuring that the information is handled in a way that protects all parties involved. Her supervisor can then decide on the next steps including potential disclosures in a manner that complies with legal obligations and ethical guidelines. This approach safeguards Lynn against legal repercussions and reflects adherence to professional standards.

Taking no action at all fails to address the ethical implications of possessing such information, while notifying potential investors directly or releasing the information to the media would be both unethical and illegal. These actions could result in severe penalties, including legal sanctions, for both Lynn and others involved. Therefore, the best path is to report the findings to her supervisor, who can manage the situation appropriately.