Suit alleges Diebold led county astray

E-voting firm falsely claimed its touchscreens were secure, activists say

By Ian Hoffman, STAFF WRITER

In a lawsuit unsealed Friday, electronic voting critics charge that Diebold Election Systems Inc. gained its first major West Coast sale by misleading Alameda County about the security and legality of its touchscreen voting systems.

The case seeks millions of dollars under California's False Claims Act and is thought to be the first application to the elections arena of a class of high-stakes, whistleblower actions more common in health care billing, construction and defense-contract frauds.

It could be the leading edge of a nationwide legal assault that, if successful, could drive the income of e-voting sales back into the coffers of government and create a cash windfall for activists seeking voting reform.

 

In California, e-voting activists Jim March of Sacramento and Bev Harris, the Seattle-based founder of BlackBoxVoting.org, sued Diebold Election Systems and its parent, Diebold Inc. of Canton, Ohio, on behalf of Alameda County and the state of California, which supplied three-fourths of the $11.8 million that the county spent on Diebold touchscreens.

March and Harris allege that Diebold officials falsely claimed their touchscreens were secure

against tampering and knowingly supplied Alameda County with uncertified voting software, contrary to the purchase contract and state law.

"Diebold said that their voting system had state-of-the-art security. It wasn't. It was kindergarten-level security," said March, a former programmer and an e-voting activist on the board of BlackBoxVoting. "They used uncertified, illegal software in Alameda elections when their contract with Alameda said they shouldn't do that."

Diebold officials could not be reached for comment.

So far, the California Department of Justice and Alameda County have not said whether they will join in the lawsuit. A spokesman for Attorney General Bill Lockyer said the state is "continuing its investigation" of the merits of the False Claims Act case.

Lockyer's office already is evaluating potential criminal and civil actions against Diebold, on the recommendation of Secretary of State Kevin Shelley, who accused the nation's leading e-voting vendor of breaking California election law and lying to state election officials.

Alameda County officials dressed Diebold representatives down last spring after a string of failings.

The firm was late delivering printed ballots. Its core vote-tabulating software tended to give thousands of optically scanned votes to the wrong candidates in certain circumstances. In the March primary, Diebold shipped hundreds of hastily assembled and barely tested voter-card encoders that broke down in the early hours of Election Day at about a third of the county's polling places, temporarily shutting down electronic voting there.

Alameda County Counsel Richard Winnie could not be reached Friday. But in an earlier interview, he said the county is focused on getting Diebold to live up to its contract and supply a fully approved, fully functional voting system.

"We continue working with Diebold and this contingency of whether we have electronic voting or not. The time is approaching when we have to make a choice," Winnie said.

County officials haven't ruled out switching to a new voting-system supplier.

"We don't have our eyes closed to other possibilities but they are the contractor that we have a contract with," Winnie said. "In the end we're going to have some problems with them if they don't produce."

Diebold lately is meeting the county's demands. New voting and vote-counting software has passed national testing and California's testing of its electronic-voting functions. The state hasn't tested its handling of high volumes of optically scanned ballots, a problem that cropped up in the October gubernatorial recall in Alameda County and in the March primary in San Diego County.

March, Harris and other Diebold critics say the county should join their suit, which offers damages of up to three times the original contract value to both the county and the state if they prevail.

"This puts the onus on them to justify to the taxpayers of Alameda County why they are using a flawed system when they could get all their money back and then some," Harris said.

If the county and state choose not to join the suit, the governments still would reap a portion of any damages awarded, but March, Harris and their attorney, Lowell Finley, a longtime elections lawyer in Oakland, would garner a larger, 30 percent share.

"It's common for governments not to want to admit they've been taken. They have a lot of professional and political capital invested in these decisions. That's the reason why there's the 30-percent option, so citizens can get their money back," March said.

Diebold caught wind of the lawsuit soon after it was filed and hired Daniel McMillan, a senior litigator and false-claims expert at the Los Angeles office of Jones Day law firm.

McMillan sent a legal budget to Diebold, suggesting it spend at least $35,000 to $50,000 a month preparing for the false-claims case and developing defenses. One argument is that Alameda County and California checked out Diebold's products and knew what they were getting.