I Think I Have A Partial Answer
Most of you, including Jason Stausser are wrong. I'd make a small bet on it. Just using pure thought.
When I saw a long line at the newly installed Monopoly machines I immediately bought Williams. And I screwed the seller. Except that he should have realized that someone might have been doing that to him. It is a legitimate part of the game. And as unpalatable as it might sound, the same is true if I overhear two terrorists on their way to bomb the Bellagio (especially if I report them first). The possibility that something along those lines is going on should be part of your calculations. Unless you are DesertCat. It is ridiculous to have laws that expect people to refrain from stuff like that.
The only time the answer is unclear, I would think, is if the information is specifically related to undisclosed aspects of a business that is only privy to insiders. That is why I would think the executive who sells a competitor's stock short when he can't buy his own, is likely breaking the law. As far as someone overhearing executives and then trading on it, my take would be that he gets off but that the executives reimburse those who lost money due to their carelessness.
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