Law Enforcement Reportedly Looking Into Circumstances of Lost Next-Generation iPhone

[cmaier]

I live in Palo Alto as well - but it seems to me that the Santa Clara County D.A. might have some jurisdictional issues if they attempt to pursue this supposed "crime" that occurred in San Mateo County.

At least the Eastern District of Texas is not looking into the matter. !

Well, like I said, it's enough if an element of the crime took place in SC. The sale, meetings between Giz and the "finder," perhaps an attempt to extort something from Apple (which is obviously in SC county), etc.

 

[AidenShaw]

Well, like I said, it's enough if an element of the crime took place in SC. The sale, meetings between Giz and the "finder," perhaps an attempt to extort something from Apple (which is obviously in SC county), etc.

Assuming that a "crime" did occur, yes.

If the law didn't have a lot of gray areas, there would be no need for lawyers.

 

[johnqh]

MobileMe can track the iPhone's approximate location.

If the iPhone passed the county line and went into Santa Clara, especially for the event of sale, then you bet SC DA has the right, and should, be on it.

 

[cmaier]

Assuming that a "crime" did occur, yes.

Jurisdiction only matters if there was a crime

 

[BaldiMac]

No, the "blog-worthiness" is not part of the value of the phone. The "blog-worthiness" comes from the fact that examination of the phone shows information that Apple doesn't want people to know, at least not today.

Of course the interest in the prototype phone and its uniqueness are part of its value. Just like a painting.

And that information would have been protected as a trade secret, but it lost its protection because Apple was careless giving the phone to an employee who lost it.

Not necessarily.
http://jballer.tumblr.com/post/540967372/gizmodos-trade-secret-liability

Gizmodo could have created their blog without buying the iPhone, by leaving the phone with the person who found it and examining it while it was in the guy's possession. And they would have paid good money for that. The information about the phone was fair game once the trade secret was lost.

Could have. But didn't.

Gizmodo took the phone and the information. The phone was protected by all the usual property rights. The information was not protected, because the trade secret protection was lost.

I'm not sure how you are separating the phone from the information gained from examining the phone. Would you separate the value of a painting from the value that you get from looking at it?

If I steal a safe worth $1000, and put a diamond ring worth $10,000 inside that is my own property, and sell the safe with contents to you for $11,000, then the value of the safe is $1000, not $11,000. If I steal an empty notebook worth $5 and write a bestseller novel into the notebook and sell the notebook to a publisher for a million dollars, the notebook has a value of $5. Less because it is used.

Or to get closer to this, I steal an iPhone, then put properly owned music worth $5000 onto it and sell it. The value of the music is just as inextricable as the value of the information: Not at all.

The person that found/stole the phone did not add any value to it.

 

[pdjudd]

MobileMe can track the iPhone's approximate

Too bad that Find My Phone is not functional in the latest 4.0 firmware beta’s - the phone was wiped via exchange wipe.

 

[doctor-don]

From the same crowd that endlessly speculates & breaks down every supposed Best Buy inventory screen shot & NOW you are mad someone gave you a legit sneak peek two months early???? Give it a rest people. The engineer is a Apple employee= HE IS APPLE. APPLE LOST THE PHONE. APPLE IGNORED MULTIPLE REQUESTS TO RETURN THE DEVICE. APPLE NEEDS TO SHUT UP & GO BACK TO COUNTING THEIR MONEY.

What IS your problem? Besides lack of education?

 

[matticus008]

I live in Palo Alto as well - but it seems to me that the Santa Clara County D.A. might have some jurisdictional issues if they attempt to pursue this supposed "crime" that occurred in San Mateo County

No crime occurred in San Mateo County.

The crime is the sale, not the loss in the bar, nor the initial pickup by Mr. Cashgrabber. You cannot sell mislaid property after finding it, regardless of whether contacting a customer support line could be considered a reasonable attempt to return it (and I'm aware of no judge who would find that it is.) A crime occurred under the California Penal Code--a finder is obligated to turn over found property above a certain value to the state if attempts to contact the owner fail. "Finders, keepers" is not and has never been the law here.

There's only a question of whether or not the police can gather enough evidence for the DA to do anything about it, and whether or not the DA considers it worth pursuing. Santa Clara takes lead on the investigation because both Apple and many of Gizmodo's bloggers are based out of Santa Clara County (Cupertino and San Jose, respectively), the handover and cash exchange presumably would have occurred locally, and thus any prosecution would be substantially tied to Santa Clara County.

 

[Cartaphilus]

...that information would have been protected as a trade secret, but it lost its protection because Apple was careless giving the phone to an employee who lost it.

Gizmodo could have created their blog without buying the iPhone, by leaving the phone with the person who found it and examining it while it was in the guy's possession. And they would have paid good money for that. The information about the phone was fair game once the trade secret was lost.

Gizmodo took the phone and the information. The phone was protected by all the usual property rights. The information was not protected, because the trade secret protection was lost.

I certainly don't believe that Apple was careless in entrusting its test phone to an employee, but even accepting your assertion, I don't believe that Gizmodo would have been permitted to disclose Apple's trade secrets it learned from examining the phone with the connivance of the finder. Since the finder was himself a thief, he had no power to give any "permission" or to bestow any rights at all on Gizmodo. Gizmodo had no right to do anything with respect to the phone that was inconsistent with the rights of the true owner. Taking apart someone else's phone, I think most people would agree, is such an inconsistent act.

The California version of the Uniform Trade Secrets Act provides in pertinent part:

(b) "Misappropriation" means:
(1) Acquisition of a trade secret of another by a person who knows or has reason to know that the trade secret was acquired by improper means; or
(2) Disclosure or use of a trade secret of another without express or implied consent by a person who:
(A) Used improper means to acquire knowledge of the trade secret; or
(B) At the time of disclosure or use, knew or had reason to know that his or her knowledge of the trade secret was:
(i) Derived from or through a person who had utilized improper means to acquire
it...

"Improper means" includes the commission of a tort against property rights. Trespassing on Apple's headquarters is no more an improper means to acquire trade secrets than trespassing against the chattel, the test iPhone.

So I think that even had Gizmodo examined the phone while the finder continued to exercise primary control of it, Gizmodo still would be guilty of misappropriation of the trade secrets it learned through tortious conduct.

I'll leave it to the IP experts to comment on the extent to which trade secrets discovered in the course of a good faith attempt to identify the owner of lost property may be disclosed. Gizmodo's claim, however disingenuous, that it had to take apart the phone to find the identity of the owner to whom it fervently wished to return it was connected with its interpretation of the California USTA in this regard.

 

[matticus008]

Your insistence that the only reasonable step is to give it to the bar proprietor is not borne out by the law. Your insistence that giving it to the police is improper is directly contradictory to california statute.

No. You are insisting that the statutes cover "mislaid" property (you added that above)--property left on a chair, table, counter in a restaurant. Where in the statutes or case law is such property determined to be "lost"? It's not. Common law made such distinctions.

Of course clear statutory authority is controlling. However, there is no clear statutory authority as to something left on a table being considered "lost" property.

The case you're looking for is People v. Stay (1971) 19 Cal.App.3d 166. Lost property in California is the common sense of the word and not any special meaning.

The statutes in question do indeed apply to the instant case; there are no different rules for mislaid property, as California makes no such distinction. I'm not sure how cmaier missed the case, as it's a famous one easily found by a cursory search, but his point is essentially correct.

Lost or mislaid property, if found and taken, must go through reasonable attempts to return the property to the party who lost it. Failing that, §2080 requires that it be handed over to the police. If no owner can be located after their intervention, it may become the finder's (but never in less than a month and never if you don't give it to the police before claiming it as your own.)

 

[cmaier]

I'll leave it to the IP experts to comment on the extent to which trade secrets discovered in the course of a good faith attempt to identify the owner of lost property may be disclosed. Gizmodo's claim, however disingenuous, that it had to take apart the phone to find the identity of the owner to whom it fervently wished to return it was connected with its interpretation of the California USTA in this regard.

The hypo could be made quite difficult. Anything that is readily apparent is probably fair game. That possibly includes anything apparent by taking the phone out of its camouflage case, and from turning it on to identify the owner.

But, as you point out, gizmodo didn't stop there - gizmodo took the device apart, photographed its innards, and published them. That clearly went too far. It's also a problem for them because prior to them publishing anything, OTHER blogs had published some of the other information (external appearance, etc.). Gizmodo probably could have argued that it didn't actually disclose anything that was still a secret since that stuff had already been fairly widely published (I should not there is case law that goes both ways, however). But the innards was another story entirely.

The statutes in question do indeed apply to the instant case; there are no different rules for mislaid property, as California makes no such distinction. I'm not sure how cmaier missed the case, as it's a famous one, but his point is essentially correct.

I was looking for a case to prove his point, not mine. As I mentioned, I found no case that gave "mislaid property" a special meaning that resulted in rules different than those for "lost" property. Of course, even this case points out that "mislaid" property is an "out-of-state" concept (i.e.: not a California thing).

 

[matticus008]

I was looking for a case to prove his point, not mine.

Okay, but that doesn't make any sense. The discussion between you two clearly shows that the point of contention was whether the iPhone prototype would be considered "lost", and there was immediate authority for that point, which was specifically requested no fewer than five times, and was never provided.

Why waste the energy trying to prove a negative when you could have ended the discussion with affirmative authority?

 

[cmaier]

Okay, but that doesn't make any sense. The discussion between you two clearly shows that the point of contention was whether the iPhone prototype would be considered "lost", and there was immediate authority for that point, which was specifically requested no fewer than five times, and was never provided.

Why waste the energy trying to prove a negative when you could have ended the discussion with affirmative authority?

Yeah, good point. I just felt that since he was arguing the statute did not apply, he had the burden of supplying the authority. But, yeah, I guess I should have just searched for the reverse proposition.

 

[Master Chief]

It's all about the sale isn't it. Well. In that case; What if there was no sale to start with? What if this so called Mr. 'Cashgrabber' can provide evidence that Gizmodo never payed him for a sale? End of story for the finder. Enter trouble for Gizmodo.

 

[mccldwll]

Okay, but that doesn't make any sense. The discussion between you two clearly shows that the point of contention was whether the iPhone prototype would be considered "lost", and there was immediate authority for that point, which was specifically requested no fewer than five times, and was never provided.

Why waste the energy trying to prove a negative when you could have ended the discussion with affirmative authority?

I too wish I'd spotted it sofa surfing on iPad. Before reading this I had already decided that the statute must also apply to mislaid property since otherwise no procedure for determining eventual ownership and disposition. [I still don't like the outcome and the apparent fact that anyone finding a purse/wallet/laptop/phone has the legal right to leave the restaurant with it, and the proprietor has no right to suggest otherwise, even though this decreases the chances the owner will ever get his/her property back]

 

[Cartaphilus]

It's all about the sale isn't it. Well. In that case; What if there was no sale to start with? What if this so called Mr. 'Cashgrabber' can provide evidence that Gizmodo never payed him for a sale? End of story for the finder. Enter trouble for Gizmodo.

The fact that the finder sold the phone has been highlighted because it is just about the most conclusive evidence there is that the finder violated his legal obligation to attempt to return the phone to its owner. Nonetheless, California law similarly condemns any failure to use reasonable and just means to return the phone. So, tossing it into the river, presenting the phone as a gift, or just taking it home, throwing it a drawer, and doing nothing else are all examples of behavior that make the finder guilty of theft. A lost phone always belongs to its owner, and the only way another person can become its owner is if he turns it into the police, files a report, and if the owner can't be identified or doesn't claim the phone within the statutory time limit. Until and unless that is done, no one can do anything with the phone other than attempt to return it to the owner. Simply put, if you're not trying to return the phone, you're stealing it.

 

[pdjudd]

Simply put, if you're not trying to return the phone, you're stealing it.

The difference in this case is that the only likely way that we know about this is that when Gizmodo had it, they squealed about it - otherwise that $5000 would have been essentially wasted. If our lucky finder never sold it, it might still have been theft, except we likely wouldn’t be hearing about it until at the very least it was officially unveiled if at all.

 

[Cartaphilus]

I still don't like the outcome and the apparent fact that anyone finding a purse/wallet/laptop/phone has the legal right to leave the restaurant with it, and the proprietor has no right to suggest otherwise, even though this decreases the chances the owner will ever get his/her property back.

That's really a great point.

 

[mccldwll]

The case you're looking for is People v. Stay (1971) 19 Cal.App.3d 166. Lost property in California is the common sense of the word and not any special meaning.

The statutes in question do indeed apply to the instant case; there are no different rules for mislaid property, as California makes no such distinction. I'm not sure how cmaier missed the case, as it's a famous one easily found by a cursory search, but his point is essentially correct.

Lost or mislaid property, if found and taken, must go through reasonable attempts to return the property to the party who lost it. Failing that, §2080 requires that it be handed over to the police. If no owner can be located after their intervention, it may become the finder's (but never in less than a month and never if you don't give it to the police before claiming it as your own.)

This is from People v. Stay, where defendant was attempting to use lost v. mislaid as a defense to theft:

"Appellant argues that inasmuch as the trial court found the carts were not "lost" then the only possible conclusion is that they were mislaid, citing out-of-state cases that distinguish between lost and mislaid articles. The fact is they were neither lost nor mislaid. The policy behind the distinction pointed up by appellant is that "n the case of mislaid goods the mislayer will probably know where the goods are and will return to the place where he misplaced them, while the owner of goods which were lost rather than mislaid will probably be unaware of the locus of the goods. Therefore, in order to insure the return of misplaced goods the owner of the locus is deemed to possess them before the finder reduces them to his physical possession, and is a gratuitous bailee for the loser. In the case of lost goods, the desire to encourage finding, according to the reasoning of the courts, outweighs all other considerations since the loser's chance of recovering the lost goods will not be substantially affected by the decision to permit the finder to retain the goods." (Paulus, Finder v. Locus in Quo -- An Outline, 6 Hastings L.J. 180, 190.) Here had defendant not taken the carts away first, the pickup services hired by the markets or market employees would soon have retrieved them."

The court acknowledged the distinction and the policy behind it.

 

[Cartaphilus]

I think if I were advising the proprietor of a place of public accommodation who observed someone find a lost valuable, I think I would advise him to insist that the finder provide identification and contact information, and if the finder refused, to call the police.

A law or local ordinance requiring a finder of lost property in a bar, hotel, supermarket, bus, etc. to either entrust the property to the management or to identify himself and provide his contact information might not be a bad idea.

 

[mccldwll]

I think if I were advising the proprietor of a place of public accommodation who observed someone find a lost valuable, I think I would advise him to insist that the finder provide identification and contact information, and if the finder refused, to call the police.

A law or local ordinance requiring a finder of lost property in a bar, hotel, supermarket, bus, etc. to either entrust the property to the management or to identify himself and provide his contact information might not be a bad idea.

Something is needed. I think the court's language--that the proprietor is the bailee for the true owner--leaves the door open as to whether the finder of "mislaid" property is entitled to any possessory rights. That would mean that the item would have to be turned over to the proprietor, and if true owner never shows up, the proprietor then becomes the "finder" for purposes of the statutes and proceed accordingly. That would also mean that the crook and Gawker don't have a leg to stand on.

Further, I seriously hope that the common law distinction, as enunciated by the court, still applies. In any event, with all the publicity this case is getting, it would be an excellent time to educate the public as to what the rights and responsibilities of finders of mislaid property actually are. And I hope this case makes it to the appellate level.

 

[Mark Booth]

I've been thinking about Gray Powell, the Apple engineer that was relieved of his prototype iPhone in a bar. Despite what some seem to think, Gray Powell is a victim, not a perp. If, indeed, he did leave his iPhone behind, it was certainly nothing he did intentionally. He simply made a mistake. Hell, it might not even be a mistake. The iPhone could have accidentally worked its way out of Gray's pocket and he simply didn't notice. Or it could have been intentionally stolen rather than "found". At this point, we don't know the exact details of HOW Gray lost possession of the prototype iPhone that night. Sure, Gizmodo has their story. But we all know there are always two (or more) sides to a story!

What we do know is that Gizmodo "outed him". And that's what I've been thinking about. Until Gizmodo caused Gray's name to be splashed all over the internet, Gray wasn't a "public figure". Since Gray was not a public figure, Gray has a reasonable expectation of privacy. In fact, he has a Constitutional RIGHT to privacy. From the California Constitution:

Article 1, Section 1

"All people are by nature free and independent and have inalienable rights. Among these are enjoying and defending life and liberty, acquiring, possessing, and protecting property, and pursuing and obtaining safety, happiness, and privacy."

Now, if Gray had voluntarily shared the prototype iPhone with a blogger, or if Gray had broken any laws to cause that information to be shared, then Gray's right to privacy could have been lost because he caused himself to become a news story, in essence, a public figure. But is the simple act of losing an iPhone enough to cause Gray to become a "public figure"?

I think not. Gray did nothing proactive to abandon his right to privacy. He simply lost an iPhone (or he was relieved of it without his knowledge). And, while a "found" prototype iPhone may be a news story that many want to read about, going into the private contents of that device and turning personal information found there into a news story seems to be a violation of privacy. The person that "found" the iPhone had no right to share that personal information with anyone. The only justification that person has for looking at the data on the iPhone is to return the iPhone to the rightful owner. That person reportedly looked through the data on the iPhone enough to find Gray Powell to be the owner, but made no attempt to return the iPhone to Gray Powell. Instead, according to Gizmodo's story, that person reported Gray's name to Gizmodo. And we know what happened after that.

It seems to me that the person that found the iPhone violated Gray Powell's Constitutional Rights by sharing private information with Gizmodo. Less clear to me is whether Gizmodo also violated Gray Powell's Constitutional Rights by making that information public.

At this point however, I wouldn't be surprised to see a civil lawsuit brought by Gray Powell naming John Doe and Gizmodo as defendants for violation of his Constitutional Right to Privacy.

Sadly, there are still people that ignorantly believe Gray Powell is to blame for all this. Which, of course, is ridiculous. That's like having a pedestrian on the sidewalk getting hit by a car being driven by a drunk and then blaming the accident on the pedestrian because he was on the sidewalk when the car was there.

Mark

 

[cutthroughthebs]

Here we go again, way to go spending tax and resources on cr@p that won't solve or lead to anything but ice-cream news.

I see... So Apple hasn't thrown in a huge chunk of those tax dollars huh? They didn't give the lost article to the police so they could get it to it rightful owners so it's trafficing stolen property! If you don't own it, you can't sell it! Your probably one of those who don't care when others property gets done up but when it's yours... you start whing about it. Throw the thieves in jail... all of them! It's not theirs and their parents never gave them a good ass warming when they were kids obviously because it's plain trafficing of stolen property... Even worse because of the $$ amount involved (grand larceny).

 

[sclawis300]

Sadly, there are still people that ignorantly believe Gray Powell is to blame for all this. Which, of course, is ridiculous. That's like having a pedestrian on the sidewalk getting hit by a car being driven by a drunk and then blaming the accident on the pedestrian because he was on the sidewalk when the car was there.

Mark

I think it is more like the pedestrian was drunk and stumbled into the road in front of a sober driver.

Something is needed. I think the court's language--that the proprietor is the bailee for the true owner--leaves the door open as to whether the finder of "mislaid" property is entitled to any possessory rights. That would mean that the item would have to be turned over to the proprietor, and if true owner never shows up, the proprietor then becomes the "finder" for purposes of the statutes and proceed accordingly. That would also mean that the crook and Gawker don't have a leg to stand on.

Why? We have made it this far in life. I find it hard to justify wasting that kind of time over one lost phone.

 

[cutthroughthebs]

Please explain to me how someone losing an item, another finding it equates to theft.

It's not yours and you sell it... Easy enough? You know damn well it's not yours and when you DONT look for the rightful owner by relenquishing it to the authorities, but you go and sell it to gizmodo, that's theft... the LAW states that as theft and when it happens to you, your all bummed out and talking trash about the scum who doesn't return it... but nobody would want your scratched up POS phone anyway because you obviously don't value anything with your way of thinking.