iPhone Prototype Finder Brian Hogan Gets Probation - California Case Law
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iPhone Prototype Finder Brian Hogan Gets Probation

The criminal phase of the Great iPhone Prototype Caper of 2010 has come to a close.

Brian Hogan and Sage Wallower, the two men who sold the iPhone 4 prototype to Gizmodo last year, pleaded no contest on Tuesday to theft of lost property, reports the BBC. Hogan and Wallflower were sentenced to 40 hours of public service and ordered to pay $250 each in restitution to Apple.

In case you missed the iPhone prototype dustup news due to Blackberry outages, we'll recap.

Apple engineer Robert Gray Powell left an iPhone prototype in a Redwood City, Calif. bar last year. Hogan found it, realized what it was, and worked with Wallower to monetize his discovery. Tech site Gizmodo bought the prototype for $5,000, dissected it, and wrote about it, reports The Wall Street Journal. The late Steve Jobs, then-Apple CEO, contacted Lam asking for the prototype's return, but Lam refused without official confirmation that he had a real iPhone 4 prototype.

So how did finding an iPhone prototype lead to criminal charges?

Under California law, a finder must make reasonable efforts to locate the owner of lost property and return it, or face theft charges. Hogan and Wallower obviously knew they had an iPhone prototype that belonged to Apple - after all, they immediately tried to sell it - so they should have tried to return it to Apple before assuming authority to sell the prototype.

While the criminal side of the case is complete, Apple could still pursue civil penalties against Brian Hogan and Sage Wallower.

Last year, Apple's attorneys told police during the recovery investigation that prototype's revelation would persuade consumers that would have otherwise purchased a currently existing Apple product to wait for the next item to be released, thereby hurting overall sales and negatively effecting Apple's 2010 earnings, reports CNET.

Apple may, however, have a hard time proving lost revenue; Apple is America's most valuable company.

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