Sergey Aleynikov fought the law, and the law lost—again.

Judge Ronald A. Zweibel of the New York Supreme Court has thrown out a raft of evidence originally gathered by the FBI for federal prosecution and later offered by state authorities attempting to prosecute Aleynikov for trade secrets theft. Finding no probable cause for Aleynikov’s original arrest, the court also faulted the feds for turning evidence over to the Manhattan district attorney instead of giving it back to Aleynikov.

Originally convicted in federal court in December 2010 and sentenced to more than eight years in federal prison in March 2011, Aleynikov spent a year in custody before the Second Circuit overturned his conviction on jurisdictional grounds. Trade Secrets Watch previously covered the legislative fix that the appellate court’s decision prompted, along with a New Jersey district court’s later order to Goldman Sachs to pay Aleynikov’s attorney fees.

But mere months after he was sprung out of federal prison, Aleynikov found himself back in hot water when the state of New York arrested him in April 2012, alleging that he accessed and duplicated Goldman’s confidential source code in June 2009. Last month, though, the state court found that the original arrest of Aleynikov by federal law enforcement was tainted because the FBI had no probable cause to arrest or search Aleynikov or to search his home.

In granting most of Aleynikov’s motion to suppress, the court, in a 71-page opinion, ruled that the district attorney cannot introduce statements Aleynikov made before being Mirandized in 2009 because the FBI had no probable cause to arrest him. And that’s not all: Judge Zweibel also found fault with the feds’ decision to send the property to the district attorney, rather than returning it to Aleynikov when his conviction was overturned.

Judge Zweibel’s order significantly narrowed the state’s case against Aleynikov. It also saddled the feds—and, indirectly, Cyrus Vance’s office—with an evidentiary ruling that the FBI engaged in unauthorized and unreasonable seizure and detention of Aleynikov’s property.   In the world of criminal trade secrets theft prosecution, defendants do not normally find much succor in the courts—but in this case, we think this is a big win for Aleynikov.

Stay with us as we follow ups and downs both civil and criminal in the trade secrets world, and from TSW to all our readers, a happy Fourth of July!