Friday, August 10, 2012

Ex-Goldman programmer case tests trade secret law and double jeopardy protections

A story by Peter Lattman in the Business Day section of the New York Times on Friday August 10, 2012 raises the issue of employer trade secrets, particularly when employees leave. The link is here.

Gergey Aleynikov was convicted in federal court for taking some code from Goldman-Sachs with him when he left to form a brokerage software startup. (It was probably something like a java library method.)  Although he served over a year in federal prison, an appeals court overturned the conviction on a technicality in the federal industrial espionage laws.
However, New York State wants to go after him, and generally the “double jeopardy” provision of the Fifth Amendment will not prevent this unless prosecutors work in concert.

It is common for employees to sign non-compete agreements (which can hurt after layoffs), and also to sign papers acknowledging their understanding of federal laws regarding copyright, trade secrets, and even corporate espionage.

However, in the early days of mainframe programming, it was common for programmers (somewhat frivolously) to take code samples (printed on greenbar, sometimes) with them as “how to do” cribsheets  for their next jobs.  I even did this once in the 1970s, even though I would not do this now. 

Update: Sept. 29, 2012

The Sept. 28, 2012 Wall Street Journal has an update article by Reed Albergotti, "Programmer's case is matter of (legal) code", link here.

There is discussion of "pseudo-double jeopardy" in New York State, and of whether Albergotti used only "open source" code in his new contract. 

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