Point72 Asset Management’s quantitative trading unit accused a former research analyst of using Anthropic PBC’s Claude and OpenAI’s Codex to steal proprietary source code with a goal of joining a competitor.
Cubist Systematic Strategies sued Xin Jin on Nov 9 in state court in Stamford, Connecticut. In its complaint, Cubist said it fired Jin in September, following an investigation that determined he "had attempted to steal (and likely did steal) confidential, proprietary and competitively sensitive information.”
The analyst, who joined the firm in 2019, used workplace access to artificial intelligence (AI) tools to view Cubist’s proprietary research and source code and transfer it to his personal devices, according to the suit. "Jin was plainly data mining and synthesising other people’s work at Cubist in order to refine it and use it at a rival,” the firm said in its suit.
Cubist is asking for unspecified damages as well as a court order blocking Jin from disclosing its confidential information or competing with it. It’s also demanding access to his personal devices, which it claims he’s refused.
In a statement, Jin’s lawyer, Rollo Baker, said Cubist’s claims are without merit. "Mr Jin looks forward to setting the record straight,” Baker said.
In a court filing on Nov 10, Jin said he’s been cooperating with his former employer as part of a proposed mediation of their disputes, including a demand for more than US$30mil (RM122mil) in investments and compensation to which he claims he’s entitled.
‘Secret sauce’
The case is the latest to highlight quant firms’ fear that employees will walk out the door with valuable code to offer up to rivals. Cubist said in its suit that the code Jin allegedly stole constituted the "lifeblood” of its business and the "secret sauce” allowing it to generate positive returns.
The suit comes as a former Headlands Technologies quant, Richard Ho, is facing a jury in a rare criminal case charging he stole that firm’s source code and then used it to defraud Tower Research Capital into investing millions of dollars with him. Ho has pleaded not guilty, with his lawyers arguing in part that he never used the code he took.
Cubist said Jin was the lead research analyst on its elite 14-person KEPL team, which is made up of alumni from top firms like DE Shaw & Co, Two Sigma Investments and Citadel and specialises in "medium-frequency statistical arbitrage strategies with high Sharpe.”
According to his LinkedIn page, Jin earned a PhD in economics at Stanford and previously held a series of internships at quant shops like Tower and Big Tech firms like Meta Platforms Inc and Alphabet Inc’s Google.
Raised suspicions
Cubist said it launched a probe of Jin’s activities in July after other KEPL team members expressed concerns about his behaviour. He allegedly suggested that he was about to leave the firm and also raised suspicions by telling colleagues he had bought market data, spent thousands of dollars on AI coding tools and was considering buying a computer with a terabyte of memory – all for his personal use.
According to the suit, Cubist found that Jin had used Claude and Codex to "systematically review, analyse, and distil the KEPL team’s research results and source code” into a readily extractable format that could be used "to rebuild the KEPL team’s work outside of company systems.” Jin tried to evade detection by deleting his AI history, Cubist claims.
Jin allegedly told Cubist human resources personnel in July that he was considering leaving for a competitor. He was then placed on leave. Jin was fired in September after he said he had accepted a position at an unspecified rival, according to the suit.
In his Nov 10 filing, Jin said he was scheduled to start with a new employer in June 2028. Baker declined to identify that firm.
The number of employees at Cubist has swelled to 600 over the past decade as Steve Cohen’s firm has expanded beyond its initial focus on stock trading and ramped up bets tied to macroeconomics, quantitative strategies, venture capital and private credit. Cubist said in its suit that Point72 now employs about 3,800 people and manages around US$55bil (RM224bil). – Bloomberg
