Details revealed in mystery of 'stolen' iPhone prototype

A second 'missing' iPhone 4G was revealed by a Vietnamese tech blog last week.

Steve Jobs asked tech blog Gizmodo.com to return a secret iPhone prototype that Apple says was stolen after a company engineer lost it in a bar, according to court documents.

The lost iPhone is being investigated as a possible trade secret theft, according to California state court documents made public after media organisations asked that they be unsealed. Apple reported the phone stolen last month. The legal wrangling is over a product that accounted for more than 30 per cent of 2009 sales for Apple.

An Apple lawyer said publicity about the "invaluable" prototype was "immensely damaging to Apple" because it would hinder iPhone sales, according to an April 23 affidavit by Detective Matthew Broad of the San Mateo County Sheriff's Office.

"I want to get this phone back to you ASAP and I want to not hurt your sales when the product themselves deserve love," Gizmodo editor Brian Lam said in an email to Jobs, Apple's chief executive officer.

"But I have to get this story of the missing prototype out and how it was returned to Apple with some acknowledgment it is Apple's." Lam sent the email after Jobs contacted Gizmodo seeking return of the prototype after the blog dissected it and posted pictures and video.

Lam said he would return the phone only if Apple provided him with confirmation that it belonged to the company, according to Broad's affidavit.

Gizmodo posted a copy of a letter from Apple's general counsel Bruce Sewell, dated April 19, asking for return of "a device that belongs to Apple". Sewell then picked up the prototype at the home of Gizmodo blogger Jason Chen, according to Broad.

Gizmodo, which is owned by Gawker Media, said it purchased the phone for US$5000 after it was found at a German beer hall in San Francisco by 21-year-old college student Brian Hogan. Based on Apple's claim that the iPhone prototype was stolen, a computer crimes task force last month broke down the front door of Chen's home and seized computers and other electronics, court filings show. Gawker Media is challenging the taking of Chen's equipment, citing laws that protect online journalists from having newsroom equipment seized.

- BLOOMBERG