I made it a point to talk to the Dad about why it wasn't such a good idea. He told me that it was better to give teens alcohol in an adult supervised setting than let them go out and drink with friends, as if those were the only two options.
So I quietly collected my wife and daughter and told them we were leaving before anybody else started driving home. I probably should have called the cops on the idiot. Every other high school graduation party I attended was either no alcohol or served to adults only.