(Bloomberg) -- Sergey Aleynikov, a former Goldman Sachs Group Inc. programmer, “stole valuable secret computer code” from the brokerage, a prosecutor told jurors at the opening of the trial in New York on charges of theft of trading software.
Assistant U.S. Attorney Joseph Facciponti made the government’s opening statement today in federal court in New York. Aleynikov’s lawyer followed, saying his client broke a confidentiality rule of the company and committed no crime.
Aleynikov is charged with violating the Economic Espionage Act and the Interstate Transportation of Stolen Property Act. U.S. District Judge Denise Cote, who is presiding over the trial, dismissed a third criminal count of unauthorized computer access in September.
If convicted, Aleynikov faces as much as 15 years in prison.
Facciponti told jurors the programmer started at Goldman Sachs in 2007 and worked there until 2009, when he agreed to take a job at Teza Technologies LLC. Chicago-based Teza promised a $1.2 million salary, a bonus and profit-sharing, compared with $400,000 he was making at Goldman Sachs, the prosecutor said.
At about 5:20 p.m. on his last day of work, June 5, 2009, Aleynikov sent parts of Goldman’s high-speed trading code to an outside computer server, Facciponti said.
Breaching a Barrier
He “thought that he’d found a foolproof way of getting around the security barriers” designed to prevent employee theft of trade secrets, Facciponti told the jury. Aleynikov sent stolen code to a code-storage website in Europe that wasn’t blocked by Goldman Sachs, he said. Aleynikov then executed a program to cover his tracks, Facciponti said.
Aleynikov was arrested on July 3, 2009. Federal agents searched Aleynikov’s laptop, a flash drive and his home computers, with his consent, Facciponti said. All contained code stolen from Goldman Sachs, he said.
A defense lawyer, Kevin Marino, argued in his opening statement that Aleynikov intended to strip out pieces of open- source software -- software available for use by the public -- contained within the Goldman Sachs code files. He tried to cover his tracks because he knew he was violating the company’s confidentiality rules and feared he would be sued by the firm.
“I will dispute to my death that violating a Goldman Sachs confidentiality provision is a federal crime,” Marino said.
Theft Allegation
Shortly after Aleynikov’s arrest, Facciponti told a judge that the programmer stole Goldman Sachs’s entire high-speed trading platform. Prosecutors have since said they believe he stole only parts of it.
The judge yesterday told lawyers that she won’t seal the courtroom as the government asked, at least during the testimony of the first four witnesses, who may testify today.
“I’m hoping that all of the testimony will be public,” Cote said.
Prosecutors asked Cote to keep parts of the evidence secret to avoid disclosing trade secrets of Goldman Sachs.
The trial is to take at least two weeks.
The case is U.S. v. Aleynikov, 1:10-cr-00096, U.S. District Court, Southern District of New York (Manhattan).
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