Ex-Goldman programmer sentenced to time served in theft case
A judge on Tuesday sentenced ex-Goldman Sachs programmer Sergey Aleynikov to time served for stealing secret computer codes that the bank had used for its trading programs.
The sentence in the notorious 9-year-old case, handed down Tuesday by Manhattan state Judge Daniel Conviser, is a win for Manhattan District Attorney Cyrus Vance Jr., who had lost the case in 2016 after Aleynikov argued that the property theft law was outdated and didn’t apply to source code.
Aleynikov, 48, has spent more than $10 million fighting the Wall Street behemoth since 2009 over 32 megabytes of code for its high-frequency trading system — a connection that led Michael Lewis to write about him in his 2014 book “Flash Boys: A Wall Street Revolt.”
After Goldman discovered that Aleynikov had stolen the code, and tried to hide his tracks by deleting his computer history, he was arrested at Newark Liberty International Airport by FBI agents.
He was convicted in 2011 of theft, and served 11 months in federal prison. The sentence was later overturned, and he was freed.
Vance’s office soon filed its own suit against Aleynikov, claiming that he’d stolen the bank’s “secret sauce,”setting in motion a winding road of lawsuits between the programmer, the bank and prosecutors.
“The misappropriation of intellectual property is a serious crime, and one that especially impacts Manhattan businesses and residents,” Manhattan Assistant Attorneys General Elizabeth Roper and Jeremy Glickman wrote in a letter to the court Tuesday.
Aleynikov has never denied that he has taken the code.
His argument is that New York’s theft law, which he was charged with violating, applied only to “tangible” property — and shouldn’t have applied to him.
At first, he appeared to succeed. In 2016, Conviser ruled that he hadn’t violated the law.
“Aleynikov doubtless acted wrongfully,” Conviser said in a sprawling, 72-page opinion at the time. “But in this Court’s view, the People did not prove he committed this particular obscure crime.”
An appeals court later overturned that ruling. In May, Conviser upheld a conviction against Aleynikov.
Vance’s office had recommended that Aleynikov serve no more time in prison following time in the federal clink seven years ago.
“And while there is no mechanism for him to receive ‘credit’ for that time towards any state court sentence, fairness dictates that the people and the court take it into consideration,” the ADAs wrote.
Aleynikov said he will appeal, according to Law360.
Aleynikov’s lawyer, Kevin Marino, said, “Mr. Aleynikov was twice placed in jeopardy for the same offense. He was acquitted in federal court because the source code copy he made was not tangible and convicted in state court because it was tangible. That’s double jeopardy. And if they were going to ask for time served, why did they waste six years and millions of taxpayer dollars pursing this case? It is an appalling abuse of power by an office becoming well-known for it.”
Michael DuVally, a Goldman spokesman, declined to comment.