[sourced from Wired]
Let's run that by again, "code did not qualify as a physical object under a federal theft statute." So, Aleynikov couldn't have stolen the code because it has no physical existence. This sounds similar to the early days of computing when programmers couldn't patent their software for the same reason. Consider the example of Dan Bricklin and Bob Frankston who came up with the idea of the spreadsheet and called it VisiCalc in 1979. Obviously since they'd invented the most important piece of PC software after the word-processor they must both have become fabulously wealthy. Sadly, no, since they couldn't patent the idea because software had no physical existence - courts ruled it would be like patenting music. They could copyright VisiCalc and prevent people copy their software but that wouldn't prevent others (e.g., Microsoft) from implementing their own spreadsheet.
Developers are now able to patent ideas and techniques used in software and I thought this legal notion of physical existence with regard to software had been dealt with long ago - apparently not.