The Claim is:
For languages \(A,B\subseteq\Sigma^\ast\) the equality
\[(A\cup B)(A\cup B)=AA\;\cup\;BB\;\cup\;2(AB)\]
LHS = \((A\cup B)(A\cup B)\)
= \((A\cup B)\cdot(A\cup B)=AA\ \cup\ AB\ \cup\ BA\ \cup\ BB.\)
= $\{uv \in \Sigma^\ast | u \in A \text{ or } u \in B \text{ and } v\in A \text{ or } v\in B \}$
RHS = \(AA\cup BB\cup 2(AB)\)
= \(AA\cup BB\cup\{xx\mid x\in AB\}\)
= $\{w \in \Sigma^\ast | (w = uv | u \in A \text{ and } v \in A \text{ or } u\in B \text{ and } v\in B) \text{ or } (w = uvuv | u\in A \text{ and } v\in B)\}$
The definitions of both are different, therefore we can say that the claimed equality does not hold.
The Counterexample (already given)
Let \(A=\{0\}\) and \(B=\{1\}\).
Then from definition,$A + B=\{0,1\}$
so, \((A+ B).(A+ B)=\{00,01,10,11\}.\)
On the other hand,
$AA=\{00\}, BB=\{11\}, AB=\{01\},$
and by the definition of \(2(A)\),
$2(AB)=\{xx\mid x\in AB\}=\{0101\}$
Hence, $AA + BB + 2(AB)=\{00,11,0101\}\neq\{00,01,10,11\}$
This is most probably not the complete proof, but I tried as much as possible to show it formally.