Brian Hogan's world closed in fast almost as soon as he sold the next-generation iPhone he found in a Silicon Valley bar to a popular technology Web site for a stack of $100 bills, according to court documents released Friday.
By April 19, Hogan's roommate was cooperating with investigators, Apple's top lawyers were meeting with police to press for criminal charges and Steve Jobs himself was personally demanding the iPhone's return.
The saga began March 25, when Apple engineer Robert "Gray" Powell left the iPhone prototype in the bar area of Redwood City's Gourmet Haus Staud restaurant, according to a sworn statement by San Mateo Sheriff's Detective Matthew Broad that was unsealed Friday.
Broad's 10-page statement was used to obtain a search warrant for the home and car of Jason Chen, an editor with the technology website Gizmodo.
It said Gizmodo paid Hogan $5,000 for the device, cracked it opened and posted images of it on April 20 despite a phone call from Jobs the day before demanding website editors return the gadget. Gizmodo promised Hogan an additional $3,500 bonus if Apple formally unveiled the device by July, according to Broad.
Now, Chen is under investigation for theft, receiving stolen property and damaging property, according to the affidavit. The affidavit also suggests Hogan and a third roommate, Thomas Warner, may also face criminal charges, and alleges the two panicked and attempted to hide evidence when they caught wind of the criminal investigation.
Shortly before midnight on April 21, the affidavit said, Hogan's roommate Katherine Martinson called investigators and told them that Hogan and Warner were removing evidence from their apartment. Investigators found Hogan at his father's Redwood City house and he directed them to nearby Sequoia Christian Church, where they recovered Hogan's computer and monitor.
Nobody, including Chen, have been charged with any crime, but the investigation has prompted ethical debate over whether he should be shielded from prosecution by California's so-called shield law, which protects journalists from having to turn over to police unpublished notes and the names of anonymous sources. But the shield law doesn't immunize journalists from breaking the law.
The investigators themselves have come under fire as well for apparently launching the investigation at Apple's behest. Detective Broad belongs to a special high technology task force called the Rapid Enforcement Allied Computer Team, which is comprised of investigators from several jurisdictions and investigates crimes against technology companies.
According to Broad, task force investigators met with two high-ranking Apple executives and outside lawyer George Riley on April 20, the day Gizmodo published the images. Riley told the task force the that Gizmodo's action were "immensely damaging to Apple," because consumers would hold off buying iPhones until the new version was released. Riley didn't estimate a dollar figure, but said losses were "huge," according to the affidavit.
San Mateo County prosecutors had argued to keep the affidavit under seal to protect the identities of witnesses and the ongoing investigation. But The Associated Press and several other media companies convinced a San Mateo County superior court judge to make the document public, arguing disclosure was necessary to ensure that the raid of a journalist's home was proper.