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Apple, Gizmodo, and the First Amendment

Can Gizmodo get into legal trouble for publishing details of Apple’s next-generation iPhone?

By
Adam Freedman
May 11, 2012

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Today’s Topic: Raiders of the Lost iPhone – Part Two!

And now, your daily dose of legalese: This article does not create an attorney-client relationship with any listener. In other words, although I am a lawyer, I’m not your lawyer. In fact, we barely know each other. If you need personalized legal advice, contact an attorney in your community.

This is the second of two articles on the difference between lost and stolen property. In these articles I’m exploring the recent incident in which a prototype fourth-generation iPhone was lost by an Apple engineer and made its way into the hands of Tech blog Gizmodo. In the earlier article, I looked at whether the phone was technically “stolen” under the law.

Gizmodo Versus Apple

Today, I’ll look at a separate question: whether Gizmodo had the right to publish details about Apple’s top-secret phone. Reader Mike C. asks how do Gizmodo’s First Amendment rights play into this?

The quick answer is that Mike has put his finger on a cutting edge issue in the law. It’s true that the First Amendment, as well as journalist shield laws, protect journalists and bloggers. But experts disagree on whether the laws protect Gizmodo from charges that it disclosed trade secrets or received stolen property.

The iPhone Saga: a Recap

First, a quick recap of the iPhone saga. On March 18, 2010, Apple engineer Gray Powell went to a German-style beer garden in Redwood City, California and, after downing a few steins, exited the bar but without the next-generation iPhone he had been carrying. The phone was found by a college student named Brian Hogan who eventually sold it to Gizmodo, which proceeded to post a detailed review of the device, complete with photos and technical specifications. Next thing you know, Silicon Valley cops launch an investigation, including a search of the home of Gizmodo editor Jason Chen.

Are Bloggers Protected by The First Amendment?

Although there has been some controversy about the status of bloggers, they generally count as “the press.”

Some commentators argue that Gizmodo could be liable for damages under California’s Uniform Trade Secrets Act. That statute allows a company like Apple to sue any person who discloses its confidential trade secrets.

But, as Mike asks: what about the First Amendment? It’s true: the First Amendment guarantees freedom of the press. Although there has been some controversy about the status of bloggers, such as those who write for Gizmodo, they generally count as “the press.” That means Gizmodo’s editors can’t be thrown in jail for running the iPhone story. But it doesn’t mean that the press never faces legal consequences for its actions. For example, if a newspaper prints a damaging story about you, you can sue the newspaper for libel, notwithstanding “freedom of the press.” 

If Apple decides to sue Gizmodo under the Trade Secrets Act, it will have to prove that the blog knew or had reason to know that Hogan had obtained the mystery iPhone “by improper means.” As we discussed in our previous article on the difference between lost and stolen property, it’s not clear that Hogan committed theft when he appropriated the iPhone; however, it is likely that he at least violated a California Civil Code provision that requires the finder of lost property to either return it to the owner or turn it into the police.

Did Apple Take Reasonable Steps to Protect the Phone?

Apple would also have to establish that the details of its next-gen iPhone are, in fact, “trade secrets.”   You’d think that’s a no-brainer, but the law requires the owner of a trade secret to make “reasonable efforts” to maintain secrecy. Gizmodo might argue that if Apple had really wanted to safeguard the phone, it would not have allowed its employees to tote it around to local watering holes.  On the other hand, Apple can point to the fact that the phone was disguised to look like a regular 3G iPhone as proof that they thought their secret was safe, even in a Silicon Valley beer garden.

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