New York Times – by MATTHEW GOLDSTEIN and BEN PROTESS
For the second time in five years, prosecutors have prevailed over Sergey Aleynikov, the former Goldman Sachs programmer accused of stealing confidential computer trading code from the bank. The first time it took a federal jury just hours to convict; this time it came after more than a week of deliberation and an accusation of “food poisoning” and avocado tampering in a state court jury room.
A jury on Friday convicted Mr. Aleynikov on one count he faced but acquitted him on another and deadlocked on a third. Mr. Aleynikov, who is unlikely to face much if any prison time, cracked a nervous smile after the decision was announced.
The split verdict — a striking conclusion to a case that divided the legal world, inspired a best-selling book and spotlighted the secret formulas behind high-frequency trading on Wall Street — came after the case nearly ended in what would have been the most bizarre of mistrials.
The possible mistrial stemmed from a dispute between two jurors deciding Mr. Aleynikov’s fate; a female juror accused a male one of “food tampering,” in part because an avocado was missing from her sandwich. The female juror also said she took a blood test to determine whether she had been poisoned, temporarily turning the criminal proceedings into a culinary whodunit.
But the judge overseeing the case, Justice Daniel P. Conviser of State Supreme Court in Manhattan, called her accusations “completely unfounded.” And after he dismissed the feuding jurors — and Mr. Aleynikov’s lawyer, Kevin Marino, dropped his request for a mistrial — both sides agreed to continue with a 10-member jury.
Their verdict, a partial victory for the Manhattan district attorney’s office in one of its most prominent financial cases in recent memory, raised questions about Mr. Aleynikov’s decision to roll the dice with the smaller jury. He could have objected to the remaining jurors, which would have either prompted a mistrial or laid the groundwork for an appeal. According to people close to the case who spoke on the condition of anonymity, Mr. Marino and even some prosecutors suspected that the 10 jurors were prepared to acquit.
In an interview with reporters on Friday, Mr. Marino explained that “we took the longer view,” avoiding yet another trial and hoping that the jury would acquit, noting that it did on one count.
In any other case, a conviction after near mistrial by food fight might seem like a plot twist that only Hollywood could dream up. But in the on-again-off-again legal odyssey that is the People v. Aleynikov, it was merely the latest in a long line of peculiar episodes.
Mr. Aleynikov, a 45-year-old former Goldman software programmer who was born in Russia and is now also a citizen of the United States, was first arrested on July 3, 2009. His first conviction was overturned in 2012 by an appeals court, which ruled that federal prosecutors in the case had misapplied the corporate espionage laws against him.
But Cyrus R. Vance Jr., the Manhattan district attorney, took up the case anew and eventually charged Mr. Aleynikov under state laws, drawing an outcry from defense lawyers, who complained about prosecutorial overkill. Then, a state judge tossed out much of the prosecution’s evidence, ruling that the F.B.I. had conducted an “illegal arrest” of Mr. Aleynikov.
Mr. Aleynikov, who lost his job and marriage in the fallout from the case, has become something of a cause célèbre in legal and media circles. Michael Lewis wrote a sympathetic profile of Mr. Aleynikov in Vanity Fair and later adapted the article into the best-selling book “Flash Boys” about high-frequency trading.
For Mr. Aleynikov, who rejected a plea deal that would have spared him prison time, the verdict is a blow but not a dead end.
Justice Conviser has expressed some skepticism about the case and left open the possibility that he might throw out the conviction, a rare step that takes place when a judge concludes that a verdict is legally invalid. His decision is expected in about five weeks.
And even if the conviction stands, Justice Conviser signaled on Friday that he was unlikely to send Mr. Aleynikov to prison, telling prosecutors that he was lifting Mr. Aleynikov’s $35,000 bail. Mr. Marino is likely to emphasize that Mr. Aleynikov already served a year in federal prison before the appeals court vacated his conviction.
The thrust of the case against Mr. Aleynikov, a bespectacled computer whiz who cuts a gaunt figure in the shadow of Mr. Marino’s football-player build, did not change from federal to state court. In the state case, Mr. Aleynikov was indicted on two counts of unlawful use of secret scientific material and one count of unlawful duplication of computer-related material.
Authorities focused on Mr. Aleynikov’s decision to download proprietary Goldman source code before leaving the bank for a high-frequency trading firm in Chicago. To cover his tracks, Mr. Aleynikov tried to delete the history of commands on his Goldman computer.
Mr. Marino did not challenge the underlying facts. Instead, he said they added up to a simple breach of Goldman’s confidentiality policy.
“There’s no doubt Mr. Aleynikov did something wrong,” he told the jury, stopping occasionally to sip from a water bottle he clutched throughout his closing statement. “But this is a very badly misguided case.”
A skilled orator with a booming voice and a knack for hyperbole, Mr. Marino once shouted in open court that the case against Mr. Aleynikov was “a wild thing,” saying that prosecutors failed to establish the basic elements of the crimes they charged.
That argument appeared to resonate with at least some of the jurors. At times during the deliberations, which began on April 22, the jurors seemed baffled by the charge of unlawful use of secret scientific material, a decades-old criminal statute that predates the digital age. The panel sent more than a dozen notes to Justice Conviser seeking clarity on the meaning of the law.
Mr. Marino said the jury’s decision to convict Mr. Aleynikov on one count of violating that law, and then deadlock on another count involving the same law, illustrated the jurors’ confusion. They found Mr. Aleynikov not guilty of the unlawful-duplication charge.
Mr. Marino argued during the trial that Mr. Aleynikov did not acquire a “major portion” of the economic value of the code, an element that the prosecution needed to prove. Mr. Marino also emphasized that Mr. Aleynikov did not make a “tangible” reproduction of the files, another requirement for proving unlawful use of secret scientific material.
“Can you taste it?” Mr. Marino asked an F.B.I. agent who arrested Mr. Aleynikov. “I don’t think so,” the agent replied.
Over the course of the trial, Mr. Marino and his client benefited from some favorable judicial rulings.
At the onset, Justice Conviser refused the prosecution’s request to delay the start for several weeks. Weeks later, the judge ruled that prosecutors could not call an expert witness because they had failed to provide Mr. Marino adequate time to prepare.
Daniel Holmes, a Manhattan assistant district attorney, made up some of that lost ground with a compelling closing argument. In the nearly 90-minute address, delivered to a courtroom packed with spectators, Mr. Holmes implored the jurors to use their “common sense.”
Despite the long deliberations, signs of juror tension did not emerge until this week. And even now, the exact nature of the avocado dispute remains a mystery.
On Monday, when the avocado dispute occurred, the jurors ordered lunch from Mon Cher market, which charges a dollar extra for avocado on sandwiches. Later in the week, jurors were on their own for lunch. But by Thursday, they were back to ordering from Mon Cher.
http://www.nytimes.com/2015/05/02/business/dealbook/ex-goldman-programmer-found-guilty.html?_r=1