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NY appeals court reinstates theft conviction of former Goldman Sachs programmer

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NY appeals court reinstates theft conviction of former Goldman Sachs programmer

The New York Supreme Court's Appellate Division has reinstated the verdict of a jury that found former Goldman Sachs Group Inc. computer programmer Sergey Aleynikov guilty of stealing high frequency trading code from the investment bank.

The appellate division's ruling reversed a trial court decision that had overturned the initial verdict of the jury. The ruling said the trial court's conclusion that the evidence was not legally sufficient to establish the offense did not take into account that Aleynikov intended to "permanently" exercise control rather than short-term borrowing.

Aleynikov uploaded the source code to a German server, downloaded it onto several personal computing devices and then shared it with his new employer Teza Technologies by placing it into a "repository" account that Teza had created on a third-party website, according to the ruling.

"The trial court's apparent belief that the source code had to have been printed on paper in order to be tangible is at odds with the language of the statute," the ruling said, adding that Aleynikov made "tangible reproduction or representation" of the code. "It would be incongruous to allow defendant to escape criminal liability merely because he made a digital copy of the misappropriated source code instead of printing it onto a piece of paper," the appeals court said.