Thursday30 June 2022

Judge Says; You Cannot Steal Code...

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73A recent decision in an appeals court could have disastrous effects on Intellectual Property rights holders in the US and possibly around the globe. Not all that long ago a software developer grabbed a chunk of code from Goldman Sachs as he was on his way out of the door. The code related to a high=speed trading application that Goldman Sachs uses for business. The firm immediately went after the programmer (Sergey Aleynikov) and he was convicted under the National Stolen Property Act.

The monkey wrench in all of this is that the law’s description of theft sates that someone must “assume physical control” of an item for it to be qualified as theft.  Chief Judge Dennis Jacobs later went on to say “We decline to stretch or update statutory words of plain and ordinary meaning in order to better accommodate the digital age.". The three-judge panel decided unanimously that Aleynikov was wrongfully convicted and the original ruling was overturned.

The panel also found that Aleynikov could not be charged under the Economic Espionage Act as the original code, though valuable, was not intended for sale or trade. This last piece is what copyright and other IP holders hide under when they push lawsuits through the system. However, the ruling will have a huge impact on these same laws as almost without exception copyright and IP lawsuits allege that use of their copyright or IP is theft. This same principal has been used when writing the laws designed to combat piracy. If downloading movies, music and other “code” when you get down to the root of things everything on the internet or a computer is code (transcoding, video encoding, etc.) We will concede that here the judges were talking about software code as it relates to an API or application, but that only means that there is no way to “steal” a program as a program is nothing but code.

On the other hand they can still attempt to hit you up for lost revenue and we are certain that congress (with a little help from lobbyists) will quickly close this loophole and make the definitions so broad that anything can be considered theft if the corporation pushing the suit wants it to be.

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Last modified on Thursday, 12 April 2012 12:25

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