Questions surround reversal of Aleynikov decision


The stunning reversal of a jury's decision to convict former Goldman Sachs programmer Sergey Aleynikov has led to lots of questions.

It's unclear exactly why the panel of three federal judges reversed the conviction, and the world awaits their written decisions. It's also unclear exactly what effect this will have on other cases. Recall that local prosecutors have charged an Alliance Bernstein employee with stealing code and that federal prosecutors have also charged an ex-engineer of Citadel with proprietary code theft.

In the Aleynikov case, Reuters reports that the three judges grilled the prosecutors aggressively, with the crux of their concerns being the relevance of stolen computer to interstate commerce.

"From the tenor of the questioning it appears the judges agreed with (the) basic argument that the trading source code had nothing to do with interstate commerce -- a critical element under the law that Aleynikov was charged with violating."

Aside from the legal issues, the lawyer for the freed computer programmer, who was facing 8 years in prison, promptly made the clout of Goldman Sachs an issue.

"You and I couldn't get the attention of the U.S. Attorney," the attorney was quoted. "But Goldman Sachs is able to pick up the phone and on 48 hours notice of the FBI first hearing Sergey's name, they are at an airport arresting him."

This doesn't necessarily deal a blow to financial services company intending to send a strong message to its IT staff about the proprietary nature of the products they work on. While federal criminal charges based on the Economic Espionage Act certainly sent a message, there are other ways to make a point. Private civil suits certainly would send a message.

In any case, employees hopefully now understand that companies take this sort of crime very seriously. While theft may not land you in prison for years, the companies can still wreak havoc with your life. It is simply not worth it to try. -Jim