In a judgement that may have serious ramifications in technology circles, former Goldman Sachs programmer Sergey Aleynikov has had his conviction for stealing the bank's proprietary high-frequency trading code overturned by a US appeals court.
Aleynikov was found guilty in late 2010 of theft of trade secrets and interstate transportation of stolen property. He was sentenced to 97 months in jail followed by three years of supervised release. He was also fined $12,500.
Aleynikov worked for Goldman Sachs from 2007 to 2009 developing programs for the firm's high-frequency trading activities. He quit to help develop an HFT platform for Teza Technologies, a Chicago-based start-up formed by ex-Citadel executive Mikhail Malyshev. It was alleged that on his last day working for the bank, Aleynikov transferred “substantial portions” of Goldman Sachs's proprietary computer code for its trading platform to an outside computer server.
However, last week the US Court of Appeals ordered the trial court to enter a judgement of acquittal ahead of the release of a legal “opinion”. Industry sources tell Squawkbox that the judgement is important as it reintroduces grey areas over how code is handled.
“This could be very important for those looking to move jobs because it makes them more transportable,” says an Asia-based developer. “Previously developers were hired on the understanding that it could take some time for them to replicate previous success and that sometimes made employers more reluctant to pay up for talent. This judgement appears to say that they can take parts of the code with them and as such they can immediately replicate and build on their success – which makes them more employable.”