US judge dimisses second conviction of ex-Goldman Sachs coder

Sergey Aleynikov improperly copied code but did not violate the law he was charged with

A former Goldman Sachs programmer saw his second criminal conviction dismissed on Monday in a long-fought, technically challenging legal battle that centered on 32MB of copied code.

The dismissal marks a significant victory for Sergey Aleynikov, who was a highly paid programmer for Goldman's high-frequency trading operation, designing complex code to make split-second trades.

Aleynikov won an appeal against federal charges in April 2012, but prosecutors refiled new charges against him under New York state laws different than the federal acts he was previously accused of violating.

In May, he was convicted by a jury of one count of Unlawful Use Of Secret Scientific Material, a rarely-used statute enacted in 1967. The jury did not reach a verdict on a similar count and dismissed another count of unlawful duplication.

On Monday, Judge Daniel P. Conviser of New York's State Supreme Court dismissed the count Aleynikov was convicted of by the jury.

Conviser wrote in his ruling that Aleynikov acted wrongfully by taking the code, but his actions did not meet the standard under the law in which he was charged.

"The evidence did not prove he intended to appropriate all or a major portion of the codes economic value," Conviser wrote.

Aleynikov's lawyer, Kevin Marino, said via email that the judge's decision is a defeat for Goldman, which "is powerful enough to provoke two failed criminal prosecutions to settle a private score."

Aleynikov put his faith in the court system and "it has been rewarded," Marino wrote. Goldman will be pursued in court to pay Aleynikov's legal fees, he said.

In the first criminal case against him, federal prosecutors alleged he uploaded proprietary code for the company's high-frequency trading (HFT) system to a computer server in Germany on his last work day at Goldman on June 5, 2009.

Aleynikov was due to start a new job at a Teza Technologies in Chicago, which had recently hired him. He long maintained that he copied the code for intellectual pursuits rather than profit, and maintained it was open-source code.

He was convicted of violating the National Stolen Property Act (NSPA) and the Economic Espionage Act (EEA) after a jury trial in U.S. District Court for the Southern District of New York, and sentenced to 97 months in prison.

But in April 2012, the Second Circuit Court of Appeals found those acts did not actually apply to Aleynikov's actions and set him free.

New York state prosecutors then took up his case, charging him in August 2013 under different laws but for the same actions, avoiding a conflict with the U.S. Constitution's Fifth Amendment protection against being tried twice for the same crime.

Send news tips and comments to jeremy_kirk@idg.com. Follow me on Twitter: @jeremy_kirk

Join the newsletter!

Error: Please check your email address.
Rocket to Success - Your 10 Tips for Smarter ERP System Selection

Tags Criminalintellectual propertygoldman sachslegal

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Jeremy Kirk

IDG News Service
Show Comments

Cool Tech

Breitling Superocean Heritage Chronographe 44

Learn more >

SanDisk MicroSDXC™ for Nintendo® Switch™

Learn more >

Toys for Boys

Family Friendly

Panasonic 4K UHD Blu-Ray Player and Full HD Recorder with Netflix - UBT1GL-K

Learn more >

Stocking Stuffer

Razer DeathAdder Expert Ergonomic Gaming Mouse

Learn more >

Christmas Gift Guide

Click for more ›

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Walid Mikhael

Brother QL-820NWB Professional Label Printer

It’s easy to set up, it’s compact and quiet when printing and to top if off, the print quality is excellent. This is hands down the best printer I’ve used for printing labels.

Ben Ramsden

Sharp PN-40TC1 Huddle Board

Brainstorming, innovation, problem solving, and negotiation have all become much more productive and valuable if people can easily collaborate in real time with minimal friction.

Sarah Ieroianni

Brother QL-820NWB Professional Label Printer

The print quality also does not disappoint, it’s clear, bold, doesn’t smudge and the text is perfectly sized.

Ratchada Dunn

Sharp PN-40TC1 Huddle Board

The Huddle Board’s built in program; Sharp Touch Viewing software allows us to easily manipulate and edit our documents (jpegs and PDFs) all at the same time on the dashboard.

George Khoury

Sharp PN-40TC1 Huddle Board

The biggest perks for me would be that it comes with easy to use and comprehensive programs that make the collaboration process a whole lot more intuitive and organic

David Coyle

Brother PocketJet PJ-773 A4 Portable Thermal Printer

I rate the printer as a 5 out of 5 stars as it has been able to fit seamlessly into my busy and mobile lifestyle.

Featured Content

Product Launch Showcase

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?