Former Goldman programmer fails to win dismissal of code theft case

A former Goldman Sachs Group Inc computer programmer failed to win the dismissal of charges by Manhattan's district attorney of stealing secret trading code, despite having earlier had his federal conviction over the same activity thrown out.

In a decision made public on Tuesday, New York State Supreme Court Justice Ronald Zweibel said the former programmer, Sergey Aleynikov, did not show that the charges brought by Manhattan District Attorney Cyrus Vance Jr amounted to double jeopardy, or were part of a "vindictive prosecution" justifying dismissal.

Zweibel also rejected the argument that Aleynikov has been "punished enough," having already spent 11 months in prison during the federal proceedings and lost his home and savings, and that ending the case served the interest of justice.

"We are in the process of reviewing the opinion, and are confident that Mr. Aleynikov will again be vindicated," Aleynikov's lawyer Kevin Marino said in a phone interview about the decision, which is dated April 5.

A spokeswoman for Vance had no immediate comment. Goldman spokesman Michael DuVally declined to comment.

Vance and U.S. Attorney Preet Bharara in Manhattan, who had earlier prosecuted Aleynikov, have made cracking down on computer crime and corporate espionage a top priority.

Federal prosecutors had accused Aleynikov of stealing trading code from Goldman in 2009 as he prepared to join a high-frequency trading startup firm in Chicago.

A federal jury found Aleynikov guilty in December 2010, but a federal appeals court in New York overturned that verdict in February 2012, saying that federal corporate espionage laws did not cover Aleynikov's alleged illegal activity.

But last August, Vance charged Aleynikov with two felonies under New York state law, unlawful use of secret scientific material and unlawful duplication of computer related material.

Aleynikov could face up to four years in prison if convicted. He remains free on bail.

Zweibel said Aleynikov was not deprived of his right under the 5th Amendment of the U.S. Constitution not to be tried twice for the same offense.

He said this was because the federal and state charges were different, and because the federal case was dismissed because the indictment, rather than the evidence, was inadequate.

The judge also said there was no reason to presume that Vance had an improper motive in bringing his case.

"Even assuming, as defendant does, that the timing of this indictment, coupled with the defendant's successful appeal of his federal court conviction, raises an inference that the prosecution may have been motivated for vindictive reasons, these factors along do not create a presumption of vindictiveness," Zweibel wrote.

The case is People v. Aleynikov, New York State Supreme Court, New York County, No. 04447/2012.

(Reporting by Jonathan Stempel in New York; Additional reporting by Joseph Ax; Editing by Phil Berlowitz)