“Are bloggers journalists? I guess we’ll find out,”
 

Computers Seized at Home of Gizmodo Reporter Who Wrote About iPhone, Gawker Media Says
By BRIAN STELTER AND NICK BILTON
Gawker Media said on Monday that computers belonging to one of its editors, Jason Chen, were seized from his home on Friday as part of what appeared to be an investigation into the sale of a next-generation iPhone.

One of Gawker’s blogs, Gizmodo, published articles last week about the future phone after purchasing the device for $5,000 from a person who found it at a bar in California last month.


Gizmodo.com
Gizmodo published articles about a next-generation iPhone that was found at a bar in California last month.
Gawker’s chief operating officer, Gaby Darbyshire, said it expected the immediate return of the computers and servers.

“Under both state and federal law, a search warrant may not be validly issued to confiscate the property of a journalist,” she wrote in a letter to San Mateo County, Calif., authorities on Saturday. “Jason is a journalist who works full time for our company,” she continued, adding that he works from home, his “de facto newsroom.”


“It is abundantly clear under the law that a search warrant to remove these items was invalid. The appropriate method of obtaining such materials would be the issuance of a subpoena,” Ms. Darbyshire continued.

The letter was shared on Monday afternoon by Nick Denton, the founder and president of Gawker Media. “Are bloggers journalists? I guess we’ll find out,” Mr. Denton said in an instant message.

It became apparent last weekend that the authorities in San Mateo County were considering whether to file criminal charges in connection with the sale of the phone, which was returned to Apple by Gizmodo last week.

According to people familiar with the investigation, who would not speak on the record because of the potential legal case, charges would most likely be filed against the person or people who sold the prototype iPhone, and possibly the buyer.

The documents published by Gizmodo indicate that the Web site was clearly girding for a legal fight. Ms. Darbyshire had sent an e-mail message on Friday to Mr. Chen before the police action, outlining the state law regarding warrants for information gathered by journalists.

“In the circumstances, we expect the immediate return of the materials that you confiscated from Mr. Chen,” she wrote.

In his account of the events, published on Gizmodo, Mr. Chen said that when he arrived home around 9:45 p.m. on Friday, the authorities told him they had been there for a “few hours already,” searching the home and cataloging computers and servers.

The warrant published by Gizmodo said the officers had probable cause that Mr. Chen’s home “was used as the means of committing a felony.”

A spokesperson for the San Mateo police said the department was “not allowed to comment.”

What felony? He found something and sold it. That's a felony? I guess the fact that he contacted Gizmodo and sold it for $5k means that he knew what it was and should have contacted Apple. Is that where the felony comes from?

I'd say that a blogger for ZDNet or Gizmodo or someplace like that is definitely a journalist. I guess the difference between a 15 year old girl than blogs about her day and a journalist would be if they were paid to write the blog? Interesting.

Chen didn't sell it, he was part of the Gizmodo team that purchased the phone.

Here is the breakdown:
Apple engineer gets drunk and leaves his phone in a bar in Redwood City on March 18
Mystery man finds phone, plays with it a little bit and figures out it is something new
Overnight Apple remotely wipes down the phone
Mystery man half-heartedly attempts to return phone to apple
3 weeks later Gizmodo buys phone for $5000
They spend a week investigating it and verifying it is real
April 17 they put it up on the website
the next day Apple requests that it is returned
Gizmodo says they will return it and tells its editor Jason Chen (who is in possession of the phone) to return it, and he does
shortly thereafter, Apple gets a warrant and raids Chen's house

Go to gizmodo for a more detailed account

I think the individual that found it did commit a felony.

If I find something in a controlled space like a bar I can reasonably assume that the owner will call there at some point looking for it so I should turn it into the establishments management.

If I find something out on the street but am able to identify it's owner then I should make every effort to return it to them or turn it over to local authorities.

There is little doubt that at some point he/she had a very good idea of what they possessed and that it had significant value.

As soon as they offered it for sale, decided not to turn it over to the owner they effectively stole it.

yea but not being a good semaritan is a long step away from being a felon.

and a bar is an open public establishment. it is certainly not a controlled space. while it is private property, it has no notion of privacy.

This is the most retarded story ever.

Apple just went down 10,000 points in my eyes.

The holes in Gizmodo’s iPhone story
Tue, Apr 20, 2010News
While the full extent of the fallout from Gizmodo’s leaking of the iPhone 4G is yet to be determined, one can’t help but notice some of the glaring holes in Gizmodo’s story regarding how they came to be in possession of said device.
Gizmodo detailed the backstory of the “missing” iPhone yesterday, where they emphasized that the individual in possession of the iPhone made an honest to goodness effort to return it to Apple, especially when he realized it was a prototype.
He reached for a phone and called a lot of Apple numbers and tried to find someone who was at least willing to transfer his call to the right person, but no luck. No one took him seriously and all he got for his troubles was a ticket number.
He thought that eventually the ticket would move up high enough and that he would receive a call back, but his phone never rang. What should he be expected to do then? Walk into an Apple store and give the shiny, new device to a 20-year-old who might just end up selling it on eBay?
This is complete nonsense on so many levels, and Gizmodo must be smoking some serious hippy lettuce if they expect us to buy this tall tale.
First, it’s proper and accepted etiquite that if you find a lost item at a bar, in this case an iPhone, you don’t take it home with you and start calling “a lot of Apple numbers” to see what happens. You return the darned thing to the bar in the hopes that the rightful owner will come back and claim it.
Second, Gizmodo tries to paint the dude who ended up with the device as some sort of noble character who refused to take it back to an Apple Store out of concern that a 20 year old “might just end up selling it on eBay.”
Oh really? This guy was so concerned with the device ending up on eBay that he decided, instead, to send photos of the device to Engadget while at the same time selling the actual device to Gizmodo for thousands of dollars.
Third, if the guy in possession of the iPhone genuinely wanted to return it, why not contact Gray Powell himself? After all, the opened Facebook app signified whose iPhone it actually was.
Fourth, there was no real need for Gizmodo to publish the name of the Apple engineer who lost the iPhone. And yes, we realize that Apple already knew who was responsible, but now the entire world is looking at Gray Powell simply because Gizmodo wanted some extra page views.
And you know what? If Gizmodo is going to publish the kids name, then they should at least have the decency to stand by their decision and not offer smart ass commentary telling Apple that they shouldn’t fire the kid.
He sounded tired and broken. But at least he’s alive, and apparently may still be working at Apple—as he should be. After all, it’s just a ****ing iPhone and mistakes can happen to everyone—Gray Powell, Phil Schiller, you, me, and Steve Jobs.
The only real mistake would be to fire Gray in the name of Apple’s legendary impenetrable security, breached by the power of German beer and one single human error.
Oh spare me.
But it gets worse.
In response to Apple’s legal request to get back the iPhone, Gizmodo editor Brian Lam pleads, “P.S. I hope you take it easy on the kid who lost it. I don’t think he loves anything more than Apple.”
Are you f’n kidding me? If Gizmodo was that concerned with taking it “easy on the kid”, they could have published the same exact story and simply reference him as a 27 year old Apple Software Engineer, and the story would have been just as gripping.
But, alas, it gets even worse!
Last night, Lam penned a post on Gizmodo attempting to explain why they decided to go public with Powell’s identity.
Hey man, I know things seem really tough right now. We had mixed feelings about writing the story of how you lost the prototype, but the story is fascinating. And tragic, which makes it human. And our sin is that we cannot resist a good story. Especially one that is human, and not merely about a gadget—that’s something that rarely comes out of Apple anymore. But hopefully you take these hard times and turn things around. We all make mistakes. Yours was just public. Tomorrow’s another day. We will all be cheering for you.
Talk about smarmy.
And fifth, Gizmodo’s response to Apple’s legal request stated in part: “Happy to have you pick this thing up. Was burning a hole in our pockets. Just so you know, we didn’t know this was stolen when we bought it.”
But curiously, Apple’s legal request made no mention of the iPhone being stolen, which makes Gizmodo’s verbiage all the more suspicious. Especially when you consider that Gizmodo’s parent company, Gawker, has in the past offered a $100,000 bounty for a stolen pre-release iPad.
Sixth, and this has nothing to do with Gizmodo, if Powell was able to wipe his phone remotely via MobileMe, why didn’t he attempt to locate it via MobileMe as well?

Finders keepers as far as i'm concerned. If apple is so secretive about their new phone they shouldn't be giving them out to their drunken employees.

Too bad for them.

If i was the judge i'd laugh in their face when who-ever it is that Apple paid off came to get the warrant.

How did we get so far away from the simplicity of right vs. wrong?

He should have returned the phone to Apple. Period. He sold property that didn't belong to him. I hope they kick his ass.

I think we deliberately rebelled from it.

Gray Powell called the bar where he lost his iPhone “constantly”
Tue, Apr 20, 2010News
By now, everyone is familiar with the facts - Apple engineer Gray Powell left the next-gen iPhone he was testing at a bar called the Gourmet Haus Staudt, where he spent the night celebrating his 27th birthday. Later that night, an unknown individual came into possession of the iPhone where he then proceeded to sell it to Gizmodo for a reported 5 grand.
According to Gizmodo’s telling of the story, this individual, upon discovering that he/she was in possession of a iPhone prototype, made a good faith effort to return it to Apple by calling Apple customer support. Curiously, though, this individual never even attempted to call the bar it was left in to see if anyone had called inquiring about its whereabouts.
Which is a shame, because Volcker Staudt, who owns the Gourmet Haus Staudt, recently told Daily Finance that Powell, in the days following its disappearance, “called constantly trying to retrieve it.”
“The guy was pretty hectic about it,” Staudt recalled.
While Gizmodo is trying to cover its ass by asserting that the iPhone seller did everything in their power to return the device to Apple, anyone with half a brain can see through Gizmodo’s BS.
Daily Finance appropriately calls them out:
Put simply, Gawker Media brazenly, publicly flouted the law. It subsidized a crime: the selling of stolen merchandise. Then it published a misleading, whitewashed account of the seller’s actions meant to make it look as though he was not acting with criminal intent. It published this account in order to disguise its own culpability in the matter.
For a variety of reasons, it’s unlikely that Apple is going to initiate legal action against Gawker, but make no mistake about it, Gizmodo couldn’t have cared less if the phone was stolen or if an honest effort was made to return it to Apple. All they cared about were there precious pageviews, which to be honest, is fine, but it’s pathetic and insulting to read Gizmodo editors try and cover up their tracks and play all innocent. Maybe editors like Brian Lam should follow in the steps of Gawker leader Nick Denton and simply own up to the fact that they paid out money in exchange for a device they knew they weren’t supposed to have, and that Apple’s property rights never factored into their equation.

Why should the guy that found it call place after place trying to find the owner? He called Apple. That's good enough as far as i'm concerned.

Apple probably transferred his call to India...

Who said anything about privacy and how does that even relate?

It's a controlled space in that there are readily identifiable employees.

Or are you insinuating that random people simply wander in and decide to wait on people, cook food, clean up, deposit the days receipts etc.....?

Snipe...India..... no, your thinking of Dell, LOL So if you find a phone at a bar, your going to call Apple service to return it instead of giving it to the bartender and saying "found this phone over there, someone lost it" PLEASE, I believe theirs more to the story....

Protocol dictates he should never have left the bar with it.

He should have handed it over to the management.

Plain and simple end of story.

If only there was some sort of app that would tell Apple where they left their iPhone. :rolleyes: ... are we to conclude that the next iPhone has no GPS?

Funny that Apple is whining about people knowing that it will have a front-facing camera and/or a Facebook app. --Yawn. It's not as if there was some new feature that you couldn't find on existing cell phones.

And then there's the real world....

Where the bartender would have pocketed it.

Does not work if the phone is turned off which I assume it was.

Whenever I or my wife misplace our phones we do the same thing that I think just about everybody does and that is to, get ready for this revelation, call it.

Which leads me to believe the finder either turned it off or worse ignored the calls.

My thought exactly.

You need some exposure to a higher class of people.

Or, this whole thing could have been setup by Apple as a publicity stunt right around the time that their earnings were reported.

If the proto was sooooooo freaking valuable, as Apple contends; then one would think that a low-jack of some sort would be implemented on every proto out for testing.

I know that Apple has it's usual 'leak' outlets, but this is giving them even more hype, just a few weeks before it's 'official' wink-wink launch.

You too.

if he did pocket it in my place he would be fired, on the spot..... I return phones all the time, if you don't it gets around that your place hires thieves, besides if it gets remote wiped its unuseable... that includes busboys and waitresses... don't like thieves, personally

Wrong.

It defies every aspect of Apples marketing model and product life strategy. A model/strategy that they have invested a decade or more and millions if not billions of dollars to craft.

One that is the envy of nearly every other consumer products manufacturer out there.

This leak will not make them money, it will cost them money, money in lost sales of currently available iPhones. If the new model were a year out instead of 2 months it would not have an impact. This close to release will have potential consumers sit it out.

so you guys think Apple purposely lost this phone for the publicity..... HAHAHAHA, now Mr Softy, yea, but nobody cares

Clearly you have met some of the same bartenders i have. ;)

You need some exposure to reality among we, the unwashed masses.

Some of the things some of you say here, and the attitudes you have, are like something straight out of a fairy tale.

It just goes to show how utterly disconnected the rich and the poor(or even the middle class) are from each other.

I have found the poor no less honorable than the wealthy or vice versa.

It's pretty well established that you shall find what you seek.

Seek out something better. It's out there.

I spend all my seeking time looking for better chicks. ;)

Round my parts you'd be lucky if they didn't jack you at gunpoint for your iphone, let alone return it to you if you lost it.

And then there is the saying, "No good deed goes unpunished," which is a near universal truism in my experience. Almost every time i've gone out of my way to do something nice for a stranger i've regretted it.

I no longer bother to try unless someone is being physically harmed and i can stop it, which i did (again) Saturday night.

So, i won't return your phone if you lose it- but then again i probably wouldn't even pick it up to begin with, such is my level of apathy.

However if i saw you getting beat up and mugged by 4 punks, i would help.

Sorry, that's the best i can offer. ;)

The person who found the phone, if they really wanted to, could have called Apple, asked to be transferred to Steve Jobs office. Of course they wouldn't be transferred to his secretary, but saying that they had the "lost" G4 iPhone and leaving the last 5 digits of the serial number would have gotten a really quick call back. It's disingenuous for anyone to say they tried to return it to Apple.

Apple should sue Gizmodo over stolen iPhone prototype
By Joe Wilcox | Published April 19, 2010, 11:05 PM
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Gizmodo was wrong to acquire a lost iPhone prototype -- quite likely a nearly finished version 4 design -- let alone pay to obtain it. Perhaps this marks the distinction between bloggers and journalists. I would have contacted Apple about returning a device so obviously stolen. There is grave difference between obtaining secret information for the public good and what Gizmodo did: Obtain property containing trade secrets belonging to a public company. Gizmodo has violated the public trust and broken the law. Free speech isn't a right to pay freely for something clearly stolen.
I typically reserve this kind of treatise on journalistic ethics for my Oddly Together blog, where in late March I posted "The Difference Between Blogging and Journalism." Betanews founder Nate Mook asked me to write something here about the journalistic and legalistic ethicacy of Gizmodo's actions. I simply couldn't refuse.

Earlier today, long-time Mac journalist Jim Dalrymple and I discussed the story. I asserted then, as I will here, that Gizmodo broke the law by obtaining stolen property and, related, by paying for an unreleased Apple product that disclosed trade secrets. The latter violates good journalistic practice, at the least.
Gadget geeks' desire to know doesn't supplant a company's right to protect millions of dollars invested in developing a product or preventing millions of dollars lost by the leakage of product designs or plans to competitors. Gizmodo did more than cross the line here. The blog lept a chasm no less wide than the Grand Canyon. The legal ramifications could, and quite probably should, be as deep.
The flow of events isn't complicated to follow:
1. On March 18, someone left in a bar what later appeared to be a next-gen iPhone prototype or near-finished device.
2. Someone else stole the device. Stolen is appropriate description because the device had been left in a public place -- presumably by accident -- and clearly belonged to someone else.
3. Gizmodo obtained the stolen smartphone by paying cash for it; Gizmodo's Jason Chen got access to the device around seven days before posting information about it.
4. Today, Gizmodo posted pics and videos and offered some device teardown that reveals to competitors much about Apple's plans for the next-gen iPhone.
5. The phone's seller sought to profit from the sale of the stolen property, while Gizmodo sought to profit from the pageviews that photos, videos and blog posts would generate.
[Editor's Note: This post presumes that the iPhone prototype is the real thing and not a fake.]
A Clear Case of Theft
There are two primary questions regarding Gizmodo's actions. Did it break the law and did it violate good journalistic prudence -- assuming anyone would apply ethics to a new media blog. Let's start with the trade secrets.
California's "Uniform Trade Secrets Act" is unambiguous, partly defining "trade secret" as "information, including a formula, pattern, compilation, program, device, method, technique, or process." The Act uses several definitions of "misappropriation," of a trade secret with one being: "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."
An unreleased phone accidentally left in a bar and sold to Gizmodo surely qualifies as acquisition "by improper means." Proper means would be purchase of the device from Apple, following its public release. What about theft? According to Section 485 of the California Penal Code:
One who finds lost property under circumstances which give him knowledge of or means of inquiry as to the true owner, and who appropriates such property to his own use, or to the use of another person not entitled thereto, without first making reasonable and just efforts to find the owner and to restore the property to him, is guilty of theft.
There's nothing unambiguous about that. According to Gizmodo, Apple software engineer Gray Powell accidentally left the iPhone on a bar stool. The person later obtaining the device sat next him. By my reading of the law, the finder is guilty of theft and likely so is Gizmodo by paying for the Apple smartphone. Estimates range between $5,000-$10,000, but who knows?
Yellow Blogging
Gizmodo is part of the Gawker family of, arguably quite successful, Weblogs. On his twitter page, Gawker publisher Nick Denton's bio reads: "Gossip merchant," which says much about the news philosophy behind Gizmodo and other Gawker properties. In a Denton memo to employees last week, he wrote: "The staples of old yellow journalism are the staples of the new yellow journalism: sex; crime; and, even better, sex crime. Remember how Pulitzer got his start: http://en.wikipedia.org/wiki/Yellow_journalism." I call its reincarnation "yellow blogging," as gossip and rumor blogsites ruthlessly compete for pageviews -- such as the well-publicized competition between Engadget and Gizmodo.
In the memo, Denton outlined eight attributes that drive pageviews: "Scandal sells"; "the pseudo exclusive"; "drama"; "visuals"; "explainers"; "don't rubbish the headline"; "parody"; and "inside baseball." So far, the stolen iPhone story has seven -- eight, if I missed parody somewhere. Gizmodo has carefully unfolded the story, like today's "How Apple Lost the Next iPhone," over several posts, with supporting pics and videos. Clearly the goal is to maximize pageviews, which have topped 3 million perhaps on their way to 5 million or more.
In many ways, this post isn't easy for me to write. I highly respect Denton for his success managing Gawker through the economic downturn and bringing back some of the drive to break stories. But there's breaking news and breaking the law. It's not like Gizmodo turned up a whistleblower revealing that iPhone causes brain cancer or that Apple uses 8 year-old boys on the manufacturing line. It's the difference between what does and does not qualify as free speech or the free press.
According to the California Uniform Trade Secrets Act:
Nothing in this section shall be construed to limit, restrict, or otherwise impair, the capacity of persons employed by public entities to report improper government activity, as defined in Section 10542 of the Government Code, or the capacity of private persons to report improper activities of a private business.
Nowhere does the Act say that journalists may "misappropriate" trade secrets for personal or company gain.
An Ethics Lesson
Tech pundit Andy Ihnatko put the right ethical and legal response in the right perspective in a blog post earlier today:
I would have thought very hard and then gone with my first impulse: return the phone to Apple. If it's been stolen, then Apple is the victim of a crime and the ethical answer is to side with the victim...If I was told that this phone had been found in a bar, I would have assumed that it had been stolen from Apple. Same result. And if the 'finder' wanted some sort of fee for this device, then I would have brought law enforcement into the discussion.
That kind of situation is so shady that no journalist with an ounce of sense would come anywhere near it. Even if you could get past the professional ethical dilemma and your ethical dilemma as a human being -- look, smart people aren't confused about how to react when someone tries to hand them a knife wrapped in a torn and bloody UPS uniform and asks them to hide it for a couple of weeks. I don't mind these problems that you have to discuss with your editor. But I try to avoid the sort of problems that result in a conversation with a criminal defense attorney.
I wholeheartedly agree. But I fall on my ethics as a Roman might fall on his sword. I'm a lowly freelance journalist. Yellow blogging is where the money is. That said, justice may come in the form of Apple's retribution. Today at TechCrunch, MG Siegler appropriately stated Gizmodo's legal situation:
It may be the most high-profile hardware leak of all time from any company. If there has ever been anything that will draw the wrath of Apple's legal team, this would seem to be it. And yet, if Gizmodo (or its parent, Gawker) have gotten a take-down notice, they haven't let it be known yet. It's possible, and likely even probable, that Apple is taking this as something worthy of action much more serious than the fairly common takedown notices the company sends from time to time.
Apple may have plenty of legal recourse. According to section 3426.3 of the California Uniform Trade Secrets Act:
A complainant may recover damages for the actual loss caused by misappropriation. A complainant also may recover for the unjust enrichment caused by misappropriation that is not taken into account in computing damages for actual loss.
Apple has sued over stolen trade secrets before, such as one lawsuit in 2004 against an "unknown individual" for leaks related to the Power Mac G4 Cube. In 2005, Apple sued several bloggers over release of trade secrets. The resulting settlement led to rumor site ThinkSecret's closure. Surely, Apple would and should take action against the "most high-profile hardware leak of all time from any company."
Denton is a new media mogul and cult personality in his own right. Steve Jobs and Apple may find Denton and Gawker to be formidable opponents. Perhaps that's the win-win Denton sees. He gains scads of pageviews from the iPhone leak, while with a lawsuit opportunity to publish an ongoing blow-by-blow account about the Apple legal skirmish. If there was ever going to be a truly public Apple legal battle, Gawker would be it. Who says blogging doesn't pay?

Selling of stolen goods?

The guy left it in a bar and someone picked it up. Unethical yes, Felony? Hm......

If the Gizmo guys were evil they would have sold it to HTC or Google. ....actually, wait. ....That would have been ripping-off HTC or Google, as the new iPhone had no notable tech of value to HTC. ...and styling like a HP Slate.

Seriously . . .what was leaked there? Besides a big ho-hum?

They may just have well of..

they took the thing apart and posted every detail about it on their website.


Gizmodo seems to be in the wrong a bit here. They knowingly purchased what could be defined as 'stolen property'. The way Gizmodo is trying to spin it just seems sleazy and wrong to me. 'ooooh we're journalists, laws don't apply to us...'

I frakking hate tech bloggers.

This thread was about blogging being journalism?

My .02 is that police had about as much of a right to bust in and confiscate Chen's computer as they do to get mine because I write this.

This makes Apple look horrible IMO.

They could have offered a reward and this problem could have gone away quietly. Instead they decided to use draconian measures. If this was a theft, that might be warranted, but instead this was a drunk engineer who lost his prototype.

They don't come across as embracing a free media when they bully anyone who opposes them.

Apple looking bad in this situation is like blaming the woman for being raped, Nick Denton is a sleaze bag , not Apple. He was willing to do anything to get his hands on that prototype $$$$..... Snipe.... if you think you've been in worse bars than I have your kidding yourself... this was an upscale bar and the protoype phone was concealed to look like a 3g

You're right. You are blaming the victim. SmileWavy

This case clearly illustrates that Apple has no problem trampling an individual's rights to preserve its own interests.

that's insane, so you think Gizmodo is the victim..LOL