Beer, betrayal, a lost iPhone in Apple device tale

Sun May 16, 2010 12:44am EDT
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By Alexandria Sage

SAN FRANCISCO (Reuters) - Fearing "huge" losses in sales after pictures leaked of its fourth-generation iPhone, Apple Inc convinced police to launch a felony investigation and Chief Executive Officer Steve Jobs contacted the offending Web site himself to try and recover the gadget.

A California court unsealed a search warrant on Friday in the case of the lost or stolen prototype 4G iPhone whose inner workings ended up on popular gadget site Gizmodo -- weaving a bizarre tale of beer gardens, paranoid lawyers and emails to the Apple chieftain.

Apple, which has released a new iPhone in each of the past three summers, is known for its secrecy. It is widely believed to be releasing its latest model this summer.

The story of the missing iPhone that belonged to an Apple engineer has captivated Silicon Valley since news broke last month. The missing phone apparently caused concern among Apple executives, according to a meticulously detailed April 23 search warrant by Matthew Broad, a detective with the San Mateo County Sheriff's office.

An outside lawyer for the company considered the missing prototype "invaluable" and publication of its details "immensely damaging" to Apple's future sales, Broad wrote. The detective is a member of the county's squad that investigates high-tech crimes.

The loss of the prototype, owned by Apple employee Robert Gray Powell, in late March prompted a meeting between company executives and law enforcement.

"Riley stated the publication of the device and its features is immensely damaging to Apple," wrote Broad in the warrant, referring to Apple's outside counsel, George Riley of O'Melveny and Myers.

Apple's director of information security, Rick Orloff, and the company's general counsel, Bruce Sewell, were also at the April 20 meeting.   Continued...

<p>Customers try out the new iPhone 3GS on the first day of its sale at the Apple Store in Zurich, in this June 19, 2009 file photo. REUTERS/Christian Hartmann/Files</p>