Denny wrote:
There has been at least one case in the past where a CFI was riding in
the back seat and was still held to be liable due to having the highest
rating...

Actually, the rule is the FAA goes after whoever will suffer the most
from the ruling. In this case, the live, CFI will. Given the choice
between a working ATP and a casual CFI, they'd go after the ATP with
a suspension.