A federal judge has ruled that Goldman Sachs must pay the legal fees of a former computer programmer accused of stealing code from the bank, a decision that wades into a hot-button issue as more and more Wall Street employees find themselves ensnared in lawsuits and investigations.
The New York Times reports that in an opinion issued Tuesday, Judge Kevin McNulty of Federal District Court in New Jersey said Goldman had a legal obligation to pay certain lawyer bills for its former programmer, Sergey Aleynikov, because he was an officer of the bank during the time in question.
'I hold that the term ‘officer’ encompasses Aleynikov’s position as a vice president' of Goldman Sachs, the judge wrote.
The judge noted that during the last six years, Goldman had paid the lawyer bills for 51 of 53 employees who needed a legal defence.
Aleynikov’s situation has been one of the more unusual white-collar criminal prosecutions in recent years. After Goldman reported him to the authorities, federal and state officials separately brought charges against him. Now, depending on the final outcome, the government’s actions against Aleynikov could cost Goldman more than $4m.
'As a result of these two misguided prosecutions, Sergey Aleynikov lost his marriage, his home, his job, his life savings, his good name and, for a full year, his freedom', Kevin Marino, a lawyer for Aleynikov, said in an e-mail. 'That the party which provoked all that misfortune must now begin to underwrite it is good news indeed'.
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image: © Lee Haywood