DOJ challenges merger between two largest voting equipment suppliers

by Geoffrey Porter // Published March 15, 2010
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Last week, the U.S. Department of Justice (DOJ) and nine states filed a Lawsuit against Election Systems and Software (ES&S), the largest supplier of voting machines in the U.S., in response to the purchase, last year, of its biggest competitor, Premier Election Solutions. The DOJ antitrust division also announced an agreement with ES&S to sell off the voting hardware assets acquired in the purchase, which effectively consolidated ownership of around 70 percent of all U.S. voting equipment in its hands, although ES&S may end up with many of the ongoing service contracts associated with the former Premier equipment. This consolidation of ownership prompted vocal opposition from voting advocates and election officials who argued that its near monopoly on voting equipment would expand ES&S’ already substantial use of predatory business practices, further raising the cost of holding elections for many localities. The DOJ actions have important implications for future reform efforts.

My hope is that the DOJ’s action will reduce the ability of ES&S to take advantage of local monopolies. Ensuring some minimum form of competition in the voting equipment industry gives localities that might otherwise be forced into an extremely unfavorable contract the chance to choose from more than one vendor, thus limiting the substantial ability to exploit localities that inevitably comes with control of 70 percent of the industry. Indeed, with the midterm elections fast approaching, one can only imagine the potential cost of allowing the purchase to stand, not to mention the disconcerting amount of control it would have given one privately owned company over democracy in the U.S.

However, the long term implications of this court decision might be even more important than the short term monetary benefits. This challenge by the DOJ might represent a shift of focus on the federal level towards reforming systems of election implementation. It is not inconceivable that this suit and the attention associated with it might signal such a movement towards an environment in which proposals for reform will actually receive consideration. For example, FairVote’s director Rob Richie, last year, argued, in an article discussing the need for election administration reform, that it was time for jurisdictions to have a “public option” for voting equipment and services. Having a “public option” would allow jurisdictions to choose to purchase equipment and services from a publicly owned, public interest-oriented company with open source software and more responsiveness to public interest needs. He suggested additional potential ways to improve the system, including providing public funding to help voting equipment suppliers cover the costs of meeting certification standards, which would ultimately help reduce the costs incurred by taxpayers when companies try to recoup their losses.

Admittedly, no parties involved in the suit actually represent policy making bodies that have the power to make such proactive reforms; however, it would not be the first time that the early successes of a reform movement came, not from Congress, but from the courts.

While demanding the separation of key assets of the former Premier Election Solutions from ES&S may ultimately represent a tangible benefit to U.S. citizens in the short term and may even indicate a long term shift toward reform, it is vital to remember that the centralization of the voting machine conglomerate still poses many problems to making our democracy truly fair. Let’s hope this suit represents an early step towards the kind of voting equipment reform that we really need.