Another bar patron handed Hogan the iPhone when the patron found it lying on a nearby barstool. This patron asked Hogan if it was his iPhone, then abruptly left. Hogan asked nearby bar patrons if the phone belonged to them. When no one said it was theirs, he and his friends left with the iPhone. Critically, there's no mention that Hogan made any effort to leave the phone with the bartender, which is what I probably would have done in that situation. [Ed: After you put together a hands-on and gallery for TUAW, you mean.]
Hogan opened the iPhone onto a Facebook page (which Gizmodo claimed identified the phone's owner as Apple engineer Gray Powell), but he said the phone immediately died after that and remained inoperative from then on. Hogan eventually removed the device's "fake 3GS" cover and realized what he'd found in a bar -- the next iPhone. One of his friends offered to call AppleCare on his behalf, but as far as his efforts to put the phone back in Apple's hands, that was it. Bar owners said no one contacted them about the phone, and Gray Powell showed up at the bar numerous times to see if anyone had found it. Once again, if Hogan had done what the rest of us probably would have done and left the phone with the bartender, this whole situation likely never would have happened.
Hogan "regrets his mistake in not doing more to return the phone." No word on whether he also regrets the $5000 Gizmodo reportedly paid him, supposedly for "exclusive access to review the phone." Hogan says Gizmodo assured him "that there was nothing wrong in sharing the phone with the tech press." I'm not an attorney myself, but just at a guess, that argument probably isn't going to hold up if this goes to court. Hogan (or someone acting on his behalf) reportedly approached Wired before Gizmodo, but Wired passed on seeing the device after "a thinly veiled request for money."
His attorney tries to paint Hogan as an upstanding young man, "the kind of young man that any parent would be proud to have as their son." That having been said, Hogan definitely erred when he gave the prototype to Gizmodo instead of Apple. It remains to be seen what consequences, if any, he will suffer as a result of that error.