According to KCBS, police know who stole the G4 iPhone that was supposedly "found" in a Redwood City bar and subsequently sold it to Gizmodo blogger Jason Chen for $5,000.

As we mentioned earlier, Chen had his computers snatched by the po-po on Monday in an apparent angry crackdown by Apple on this unwelcome leak. The legal ground Chen thought he stood on — protecting the person who sold him the phone under the auspices of journalistic source anonymity — turns out to be pretty shaky when Apple starts alleging that the prototype phone was stolen property.

TPM Muckraker runs down all the salient points of the dispute in this handy piece. (For the record, the Gizmodo team says they had no clue the thing was stolen.) We feel bad for Jason because, you know, all bloggers enjoy big scoops such as this, and being raided by police does seem like kind of an extreme measure when the issue in question is a goddamn cell phone. Bow down to Apple people. They will not be messed with.