The missing legal link in the Gizmodo-iPhone case

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Last month a software engineer at Apple accidentally left his iPhone in a bar. A fellow patron picked up the phone and asked the people in the bar around him if it belonged to any of them. It didn’t. He took the phone home and the next day noticed that the phone looked odd. He jimmied open its case and saw that the phone was different from any iPhone he’d ever seen. That was because it was a prototype of a phone Apple hasn’t yet started to sell. It was what we might call a trade secret. The phone-finder called Apple and was given a ticket number, but no other guidance about what to do. So he sold the phone on the Internet shopped the phone around*. The buyer, at a price of $5,000, was an employee of the tech-review web site Gizmodo.

Since then, Gizmodo has posted information about the phone online—and become the center of a police investigation that involved the San Mateo, Calif. police raiding Gizmodo editor Jason Chen’s home last Friday. The blogosphere—which perfectly combines two very interested parties, tech enthusiasts and people who get paid to write about technology online—has been on fire debating the various ways in which the police may have broken the law. The Atlantic does a great job summarizing the issues at play. Are online news outfits afforded the same legal protections as traditional media organizations? Is what Gizmodo does even journalism? Did Chen truly believe that the person who found the iPhone made a good faith effort to return it, and was Chen himself legally obligated to make such an effort? Does it matter that Gizmodo paid for the phone?

Many of these issues miss what, to my mind, is the more important legal point: does it actually matter what the next iPhone looks like?

The rationale for letting journalists have special legal protections when it comes to the dissemination of information is that what they are doing serves a greater social purpose. In other words, they are acting in the public interest.

There have been a series of court cases over the years about how to define public interest when it comes to companies’ trade secrets. One involves Apple and online reportage. Back in 2004, confidential plans about a new Apple device used to produce audio recordings appeared on two Apple-centric news sites. It seemed that the information had come from an internal presentation and that an Apple employee had leaked the information. Apple asked a court to subpoena the news sites to disclose their sources and the court agreed. The sites appealed and eventually prevailed—although largely because the appeals court determined Apple hadn’t done enough on its own, like interview its employees, to find out what had happened.

Nonetheless, as that case progressed, the various courts involved spent time contemplating whether the information that was apparently leaked served the greater social good by being made public. The trial court decided that it didn’t. Were there a lot of people interested in reading about the not-yet-released Apple product? Sure there were. But, as the court noted, “an interested public is not the same as the public interest.” Just because a journalist winds up with a trade secret that a lot of people want to know about doesn’t mean it’s okay for him to write about it.

Let’s consider a few situations. I’m in a bar and come across a Philip Morris PowerPoint detailing a new marketing campaign to get 15-year-olds to start smoking. I’m pretty sure I’m acting in the public interest when I write about it. Another hypothetical: the government is investigating the possible ill effects of a new genetically modified corn seed from Syngenta. I happen to gain access to the technical details of that seed and publish them. Again, I’d argue that I’m putting information into the world that has true social value.

Now let’s consider Gizmodo’s big finds. No. 1: the new iPhone will have a camera on the front. No. 2: the back of the new iPhone will be flat. No. 3: the new iPhone will weigh three grams more than the current one. There are more revelations, but they all fall in the same place on the scale of social significance.

A lot of the commentary on the Gizmodo-iPhone dust-up predictably revolves around whether or not online purveyors of news and information will get treated the same way as the organizations that do those things in print. That’s a shame. First of all, because as a Time magazine staff writer currently writing a blog post, I can tell you that the distinction is pretty much meaningless. But more importantly, because it focuses the debate on format and not content.

Are people who write things on web sites acting to serve the public good? Well, some are and some aren’t.

If you are, then you get special legal protection. If you’re not, then you are simply working for a company that’s out to make money off of information. There is nothing wrong with that. But it does mean if you come across property that’s not yours, you’ve got to give it back.

*Thanks to former Time editor Phil Elmer-DeWitt for correcting me on this. He’s now blogging about Apple over at Fortune. Read him here.

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