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Closing Arguments Today in Code Trial

MANHATTAN (CN) - Closing arguments begin today in the trial of former Goldman Sachs programmer Sergey Aleynikov, who is accused of stealing computer code for a high-frequency trading system. Prosecution and defense rested Wednesday, after a defense witness testified that significant portions of the company's software contain public domain code freely accessible on the Internet.

Aleynikov is accused of swiping Goldman Sachs' proprietary code for a trading system that is said to be able to place automated trades milliseconds before competitors.

Federal prosecutors said the code was so secret that the courtroom had to be sealed from jurors and spectators several times for attorneys to question witnesses about specific programming for the record.

Defense attorney Kevin Marino said that Aleynikov downloaded only the portions of Goldman Sachs code that he had programmed, in order to discover which portions of it contained open source code, which is free and available on the Internet.

NYU Professor Benjamin Goldberg, the only witness called by the defense, testified that Aleynikov was "very active in the open source community," and that "the material he downloaded [from Goldman Sachs] included lots of open source code."

During testimony last week from Goldman Sachs director Paul Walker, the defense attorney suggested that his client downloaded the Goldman code to separate the "wheat," the "naked open source software" that he used in designing the program, from the "chaff," the modified code belonging to the company.

At the time, Walker called such a strategy "almost impossible" to implement and added, "That would be a ridiculous way to do it." If Aleynikov wanted the open source software, he could have got it from the Internet, Walker said.

Professor Goldberg disagreed, saying that ferreting out open source code from programs he helped build was "an efficient way" for Aleynikov to find public domain code to use on other high-frequency trading systems.

Walker also testified that Goldman had a policy of segregating open source material from its proprietary code, in part to protect its copyrighted software from being subject to open source licenses, making them publicly available.

Goldberg said that his report, based on a 60-hour search of the downloaded files, showed that the company code that Aleynikov downloaded "included lots of open source material" that "was all mixed together" with proprietary files.

The Frequently Asked Questions of one such license, the GNU General Public License v2.0, states: "You cannot incorporate GPL-covered software in a proprietary system. The goal of the GPL is to grant everyone the freedom to copy, redistribute, understand, and modify a program. If you could incorporate GPL-covered software into a non-free system, it would have the effect of making the GPL-covered software non-free too."

To prevent this from happening, one must "make sure that the free and non-free programs communicate at arms length, that they are not combined in a way that would make them effectively a single program," the FAQ states.

Last week, Walker acknowledged under cross-examination that some open source licenses call for programmers to "re-contribute" any modifications to the software into the public sphere.

In cross-examination, prosecutor Joseph Facciponti asked the professor if "the most you're willing to say" is that "some" of the code Aleynikov downloaded was public domain.

Goldberg replied that "some," in this case, "is a sizeable amount."

The prosecutor asked Goldberg why Aleynikov would erase his bash history if not to hide his actions. Goldberg responded that it was possible he wanted to delete records of passwords for encrypted files.

After several redirect examinations, Goldberg was excused in the afternoon, after which defense attorney Marino stood up and said, "And with that, Your Honor, the defense rests."

Earlier Wednesday, UBS contract attorney Nelson De La Cruz was called to the stand as the final government witness, and spoke briefly about Aleynikov's interview for a job at his company, years earlier.

Aleynikov submitted a resume listing his employment with a company that developed software for a computer game based on "Wheel of Fortune," De La Cruz said.

Before he took the stand, prosecutors projected documents from a civil action filed by Merv Griffin Enterprises against Aleynikov and other defendants calling for an injunction in November 1997. An injunction was issued, barring Aleynikov from creating and disseminating any program based on the game show.

After De La Cruz's testimony, U.S. District Judge Denise Cote reminded jurors, "The defendant is not charged with any violation related to 'Wheel of Fortune.'" She added that the information could not be used to impute his character.

The trial continues today with closing summations.

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