I am apparantly fated to be permanently at war with Bill Lockyer. Sigh.

[Jim March]

War on the gun stuff:

http://www.equalccw.com/prarwars.html - and they're probably going to fight on the CCW PRAR aimed at DOJ.

And now this:

-------------------
http://www.ledger-enquirer.com/mld/ledgerenquirer/business/10148523.htm
(and a LOT of other URLs, it's all over the 'net...)

Posted on Wed, Nov. 10, 2004

Calif. settles electronic voting suit against Diebold

RACHEL KONRAD

Associated Press

SAN FRANCISCO - Diebold Inc. agreed Wednesday to pay $2.6 million to settle a lawsuit filed by California alleging that the electronic voting company sold the state and several counties shoddy voting equipment.

Although critics characterized the settlement as a slap on the wrist, North Canton, Ohio-based Diebold also agreed to pay an undisclosed sum to partially reimburse Alameda, San Diego and other counties for the cost of paper backup ballots, ink and other supplies in last week's election. California's secretary of state banned the use of one type of Diebold machine in May, after problems with the machines disenfranchised an unknown number of voters in the March primary.

Faulty equipment forced at least 6,000 of 316,000 voters in Alameda County, just east of San Francisco, to use backup paper ballots instead of the paperless voting terminals. In San Diego County, a power surge resulted in hundreds of touch-screens that wouldn't start when the polls opened, forcing election officials to turn voters away from the polls.

According to the settlement, Diebold must also upgrade ballot tabulation software that Los Angeles County and others used Nov. 2. Diebold must also strengthen the security of its paperless voting machines and computer servers and promise never to connect voting systems to outside networks.

"There is no more fundamental right in our democracy than the right to vote and have your vote counted," California Attorney General Bill Lockyer said in a statement. "In making false claims about its equipment, Diebold treated that right, and the taxpayers who bought its machines, cavalierly."

The original lawsuit was filed a year ago by electronic voting critic Bev Harris and activist Jim March, who characterized the $2.6 million settlement as "peanuts."

March, a Sacramento whistle blower who filed suit on behalf of California taxpayers, could receive as much as $75,000 because of the settlement.

But he said the terms don't require Diebold to overhaul its election servers - which have had problems in Washington's King County and elsewhere - to guard them from hackers, software bugs or other failures.

The former computer system administrator was also upset that the state announced the deal so quickly.

Several activist groups, computer scientists and federal researchers are analyzing Nov. 2 election data, looking for evidence of vote rigging or unintentional miscounts in hundreds of counties nationwide that used touch-screen terminals. Results are expected by early December.

"This settlement will shut down a major avenue of investigation before evidence starts trickling in," March said. "It's very premature."

A Diebold executive said the settlement would allow the company to spend more money on improving software and avoid "the distraction and cost of prolonged litigation." Diebold earnings plunged 5 cents per share in the third quarter because of the California litigation, which could cost an additional 1 cent per share in the current quarter.

Diebold shares closed Wednesday at $53.20, up 64 cents, on the New York Stock Exchange.

ON THE NET

www.diebold.com
-------------------

Right. Jim again - lemme translate:

It's utter crap. A whitewash, slap on the wrist, settlement for peanuts...and as an extra insult, they structured it to give Bev and I the least possible amount of cash - about $75,000 each.

What I mean is, the settlement is $2.6mil. Of that, they're claiming $1.3mil is based on the "false claims act" portion - the part Bev and I are entitled to a cut of. And they're trying to give us the minimal 15% cut of that. (The first 25% of that 15% goes to our lawyer, then Bev and I split the rest.)

The other half is supposedly settlement for an "unfair business competition" claim the AG's office wrote up. Problem: the unfair business competition claim, if it went to trial, could NOT result in monetary fines, only changes in how they do business. The only reason they put money into that cause of action was to keep the whistleblower chunk artificially low.

It gets worse: the new "complaint" by the DOJ strips out all mention of how disgusting the Diebold product really is, especially that horrid MS-Access-based GEMS central vote tabulator software. Lockyer's minions want to slap Diebold around for minor technical violations of law, while ignoring the fraud and the deliberate tamper-friendly features of the software. Here's the real scoop:

http://www.equalccw.com/deandemo.html

As an added insult, the AG's office told us about this screwed-up settlement last night, and said we had until Friday to decide whether or not to fight. Except they also told the whole world in a press release that "a settlement had been reached" (ignoring that Bev and I hadn't chimed in!) and the first I hear about it is Rachel Konrad of AP asking me to comment!?



On top of that, Diebold will be "paying" $2.6mil, but the stock price increase as a direct result of the settlement has netted them over $42mil!



You think I ain't *POed*?

We're going to fight this tooth and nail. It's not just myself and Bev screwed, it's the whole state - Diebold ripped us off to the tune of about $100mil because *none* of their stuff is legal under the California Elections Code 19205(c). And the timing couldn't be worse - we've got data flooding in from the Nov. 2 election but not enough time yet to catch any more actual fraud.

We've got SOME real Diebold fraud in King County WA from that state's primaries - three hours worth of audit log on the central tabulator were smoked right on election night. The election officials there deny it. Problem: in response to the same public records request by Bev, they provided summary reports date/time stamped about every 45 minutes. Each one was signed by the elections officials and several cover the three-hour window in question. These were printed by GEMS, which records audit log entries when these are printed. Which are missing.

Whoops.

Anyways. Lockyer is in for the fight of his life here. I have no idea why he wants to whitewash Diebold, or whether or not he really understands how rotten these fools are. But he's gone an' picked on the *wrong* folks here.



Final thought: if the deal said that Bev and I only get $75k each BUT Diebold gets thrown totally out of the state, I'd be cheering for it. It ain't the money, it's the whitewash.

:banghead:

 

[Sven]

Jim - this is a very frustrating - and interesting turn of events. We are all watching your every move.

 

[Jim March]

SJ Murky Snooze just posted - they actually did pretty good but I suspect Ian Hoffman at the Oakland Tribune is really going to pound the heck out of Diebold and Lockyer - expect that later this AM. Meanwhile:

http://www.mercurynews.com/mld/mercurynews/news/world/10152946.htm?1c

Posted on Thu, Nov. 11, 2004

E-voting maker to pay big fine

ATTORNEY GENERAL CLAIMS DIEBOLD LIED

By Elise Ackerman

Mercury News

A leading manufacturer of electronic voting machines has agreed to pay an unprecedented $2.6 million fine after the state attorney general found it had lied about equipment sold in California and violated state laws.

The settlement, announced Wednesday, would be the first such punishment of a touch-screen manufacturer. Other costs related to the agreement could force Diebold Election Systems of North Canton, Ohio, to pay out an additional $1.7 million.

The company would be required to beef up the security on its electronic voting machines and to provide the secretary of state with additional information about the development, testing, installation and operation of its equipment.

``This settlement holds Diebold accountable and helps ensure the future quality and security of its voting systems,'' Attorney General Bill Lockyer said in a statement.

Lockyer and Alameda County prosecutors had accused the company of making false statements about the security of its electronic voting systems and its compliance with federal and state certification requirements.

If approved by a judge, the settlement would end a lawsuit filed by two whistle-blowers and later pursued by Lockyer and the county prosecutors. A hearing in Alameda County Superior Court is tentatively scheduled for Dec. 10.

Diebold admitted no wrongdoing. In a statement, the company said that it believed it had ``strong responses'' to the charges but preferred to avoid prolonged litigation.

``This is a step we needed to take to move forward in California and hopefully work to rebuild trust in the state,'' said company spokesman Mike Jacobsen.

Jim March, a computer technician who filed the initial lawsuit, criticized the settlement for ignoring security flaws in vote-counting software that is used around the country. March is expected to ask the judge to postpone the deal at least six weeks until it is clear how Diebold's equipment performed in the Nov. 2 presidential election.

March and Bev Harris, a Seattle publicist who exposed the security risks of electronic voting through her book ``Black Box Voting'' and Web site, filed an initial false-claims suit against Diebold in November 2003. Lockyer and Alameda County prosecutors intervened in that lawsuit Sept. 7 and crafted the settlement with company attorneys.

Under the settlement, Diebold would pay $1.62 million to the state of California and $475,000 to Alameda County. Another $500,000 would go to the Institute of Governmental Studies at the University of California-Berkeley to fund research aimed at training poll workers to use new voting technology.

March and Harris are entitled to claim a portion of those fines and to recover attorneys fees and other costs.

In addition, the settlement requires Diebold to compensate Kern, San Joaquin and San Diego counties, which were forced to pay for optical-scan equipment for this month's election after Secretary of State Kevin Shelley banned the use of a new Diebold touch-screen voting machine they had purchased.

And Diebold must reimburse Alameda, Plumas and Los Angeles, which were forced to implement additional security measures to use an older model Diebold touch screen.

In a statement released Wednesday, Diebold estimated the settlement, combined with the additional cost of reimbursing California counties and other associated expenses, would cost 6 cents per share -- or $4.3 million.

Diebold's earnings per share for the third quarter were 5 cents below forecasts as a result of the company's legal woes. Its shares rose 64 cents, to $53.20, on Wednesday's news.

Separately, a former Diebold employee named Kenneth Ray Reyes pleaded no contest Thursday in San Mateo County Superior Court to embezzling money from multiple ATMs. In addition to electronic voting machines, which form 5 percent of Diebold's business, the company manufactures ATMs and safes.

Jacobsen said Reyes, who had been responsible for maintaining ATM machines, was dismissed from the company some time ago.
Contact Elise Ackerman at eackerman@mercurynews. com or (650) 688-7588.

 

[agricola]

Jim,

Forgive my ignorance, but over here if there are several parties to a lawsuit all must agree on the settlement, and if one party wants to settle he cannot dictate what the other parties recieve.

From what has happened to you I guess its not the case here; is that because of CA law or because Lockyer agreed to stand for you?

 

[Aguila Blanca]

Get 'em, Jim.

This affects us all, because I'm sure more and more states are going to be succombing to the siren song of electronic voting in the future, both near and immediate.

I wish all states would use those clunky mechanical machines I remember being shown in grammar school in Connecticut. Automatic audit trail, easy for votors to use, virtually tamper-proof. And from what I have heard, not longer manufactured.

 

[Jim March]

Agricola, you have it right.

Lockyer and company's behavior is outrageous here.

Tuesday afternoon (two days ago), they finally told us what they've negotiated. They told us we had till Friday to decide whether to go along with this mess or challenge it before the judge who has to approve the final settlement (which has NOT occurred yet). They told us that if we didn't play along, Lockyer's people would argue to the best of their ability that Bev, myself and our attorney Lowell Finley are entitled to *nothing* whatsoever before that same judge.

In reporting this travesty to myself and Bev Tuesday afternoon, Lowell advised us not to go public yet because standard practice would be that the AG's office (and Diebold) wouldn't go public until the judge signed off on the actual deal - presumably they'd try to go before the judge this coming Friday or early next week.

Instead, the AG's office and Diebold jointly announce a "settlement" with NO word to the press that Bev and I still legally have the opportunity to object. They're trying to railroad this deal past us and past the *judge* in some respects.

This is the most arrogant, screwed up mess I've ever heard of. Gawd almighty.

 

[R.H. Lee]

Is this the same Bev Harris who is trying to overturn/reverse the results of the recent Presidential election by confiscating all the electronic voting machines? The same Bev Harris AirAmerica radio is referring listeners to and encouraging donations for the above captioned scheme?

In any event, if you are a party to the suit, Lockyer cannot 'settle' on your behalf, AFAIK. Lockyer's interest is purely for advancing political perception as a 'guardian' of the people, and maybe he's been promised 'support' from Diebold in one form or another for a possible gubernatorial run.

 

[pax]

They're trying to railroad this deal past us and past the *judge* in some respects.

When it goes back to court, Jim, I'd think you'd want to point out the second half of that a little more emphatically than the first.

Eagerly awaiting developments.

pax

 

[Jim March]

Yup, good ol' Ian:

http://www.oaklandtribune.com/Stories/0,1413,82~1865~2528132,00.html

Article Last Updated: Thursday, November 11, 2004 - 6:39:36 AM PST

E-voting firm puts adversity behind it

Diebold's stock gains after firm makes payment

By Ian Hoffman, STAFF WRITER

California's attorney general and Alameda County endorsed a $2.68 million settlement with Diebold Election Systems Inc. on Wednesday, yielding a stock bump for Diebold's parent company that paid for the settlement 17 times over.

If approved by a state judge, the proposed agreement -- and few problems with Diebold's touch-screen machines in the Nov. 2 election -- lifted the market cloud that had gathered since last November over Diebold's voting business in California.

"In making false claims about its equipment," said Attorney General Bill Lockyer, Diebold treated California voters and taxpayers "cavalierly."

"This settlement holds Diebold accountable and helps ensure the future quality and security of its voting systems," Lockyer said in a prepared statement.

Given California's influence over the voting market, the few new security measures in the agreement are likely to foster demands for similarly tightened security elsewhere in the nation.

Diebold shares rose 1.2 percent with announcement of the settlement, boosting the firm's market value by $46.3 million.

The company admitted no fault or violation of state law in the proposed agreement, which would end a False Claims Act lawsuit filed last November by two e-voting critics on behalf of state and local taxpayers. They vowed to oppose the settlement at a hearing tentatively set for Dec. 10.

"If it meant throwing Diebold out of the state, we'd gladly take it," said Jim March, a Sacramento-based e-voting activist and board member of BlackBoxVoting.org. "But Diebold gets a slap on the wrist and isn't required to do anything seriously new in terms of security? I don't think so. This stinks."

Under the settlement, Diebold would pay $1.6 million to the state and $475,000 to Alameda County, plus give $500,000 to the University of California, Berkeley's Institute of Government Studies for research on training poll workers for electronic voting.

The payment to Alameda County was not meant as reimbursement for any part of the $12 million in local and state money used to buy 4,000 Diebold touch-screens in 2002.

Rather, the settlement was intended to reimburse Alameda for extra personnel costs tied to widescale breakdowns in voting equipment during the March primary and the correcting of vote totals last fall, when a Diebold computer misawarded thousands of gubernatorial votes to the wrong candidate.

Diebold also agreed to several security measures, most of which already were implemented -- such as changeable passwords and encryption codes in its software -- or are required by state law. Diebold promised, for example, to share previously secret testing reports from its contractor laboratories with the secretary of state's office.

A new state law authored by Sen. Don Perata, D-Oakland, already requires the delivery of those reports.

The settlement also allows Alameda and other Diebold touch-screen counties to seek additional money from Diebold as reimbursement for stocking paper provisional ballots in their polling places Nov. 2. Alameda County officials say they will not ask Diebold for that or other money unless future problems crop up with its equipment.

So far, preliminary analysis of Election Day mock voting on a random selection of California touch-screens made by Diebold and other companies show 100 percent accuracy in recording votes.

March and BlackBoxVoting.org founder Bev Harris sued Diebold on behalf of California and Alameda County. March said the settlement was "steamrolled" by state officials and was "ugly."

Attorneys for the county and the state took over the case, left March and Harris out of settlement negotiations and rewrote their lawsuit to remove most of its claims of poor security in Diebold's central vote-tabulating software, known as GEMS.

"I don't know what Lockyer is thinking," said March. "I do know he's not paying attention to the core, structural problems with GEMS. And the timing of shutting down this case so close after the election sucks."

March plans to urge the judge to reject or postpone the settlement until more data is available on the performance of Diebold touch-screens in the presidential election.

"Put everything on hold and wait until we see what evidence rolls in," he said.

The settlement does include a few novel security measures. Diebold must offer its client counties in California the option of disabling some less-secure functions on the machines and insert digital signatures to authenticate files that designate which votes go to which candidates.

After describing Diebold's actions as "absolutely reprehensible" and "deceitful" six months ago, Secretary of State Kevin Shelley called the settlement "a victory for voters of California."

Diebold officials said the settlement "allows us to move forward in providing California and its residents with outstanding election systems."

Contact Ian Hoffman at [email protected]

-------------

Clarification by Jim: SB1376 passed and was signed by Arnold this year, authored by Don Perata. It calls for the SecState's office to have access to the "escrowed material" for purposes of investigating claims of dysfunctional electronic voting systems. Part of what Lockyer's people "gained" from this "settlement" is that Diebold promises to make the ITA reports from Ciber, Wyle, etc. available to the SecState's office but whoops, those are already part of the escrowed material covered under SB1376.

Most of this "settlement" is like this: it either agrees to what's now existing law (at least as of 1/1/2005) or it agrees to minor security refinements already required by Shelley under his authority as SecState - and that's another thing SB1376 does, it beefs up the SecState's ability to made security-related directives, something that's now a bit of a legal "gray area".

The "settlement" is a farce .

To see why the Ciber/Wyle reports matter, go here:

http://www.equalccw.com/Diebold-smallciber.pdf

This is a Ciber report that one of the counties sent to Bev Harris as part of her FOIA-type requests (which technically is NOT public record but they dumped it on us, it's legal for us to have it).

Note how it says the "Penetration Analysis" wasn't done, the "N/A" box for it is checked, even though FEC regs in the first column are cited. A "Penetration Analysis" on GEMS damned well WAS required, and everybody who's done such a test now that the code is available has damn near puked at how bad it is in that very category.

Note too that this Ciber (and Wyle) material gets "escrowed" with the code. That means Shelley will have access to it without a court order come 1/1/05 per SB1376.

 

[Jim March]

Is this the same Bev Harris who is trying to overturn/reverse the results of the recent Presidential election by confiscating all the electronic voting machines? The same Bev Harris AirAmerica radio is referring listeners to and encouraging donations for the above captioned scheme?

I dunno who the HELL is trying to phrase it like that!

I rather guarantee you she isn't trying to confiscate voting machines! I should know, I helped her draft the FOIAs/PRARs to local elections agencies.

As to "overturning" anything: like hell - we planned out these records requests for post-November-2nd analysis months BEFORE the election. This has nothing to do with "let's put Kerry in the white house!!!", it's about double-checking the MACHINES.

Who in God's name is putting out slander like THAT?!

 

[R.H. Lee]

As heard on the Randi Rhodes show on Air America:
http://forum.therandirhodesshow.com/index.php?act=SF&f=45

Inside the Air America Randi Rhodes discussion forum, you'll find this link to DU:
http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=104x2636130

 

[txgho1911]

:banghead:
In some pricints around the country a different machine is used. It records a paper ballot with darkened circles representing the choices. Paper ballot is then stored under lock in the lower portion of the machine. Also present under lock is a section for storage of the provisional ballots. No network connection required as I can tell and results are stored onboard maybe in an eprom or prom card.

Procurement and use of these touch-screen models seems to have been a jump on the band wagon for technology not yet mature for the application.
In a perfect world with a reasonable sized UPS and no evedence or suspision of a possible vote tampering this system might have had a place.

I am guessing you and Bev will end up in front of the judge and fighting against the premature settlement. As said earlier
Quote:
They're trying to railroad this deal past us and past the *judge* in some respects.
Quote:
Final thought: if the deal said that Bev and I only get $75k each BUT Diebold gets thrown totally out of the state, I'd be cheering for it. It ain't the money, it's the whitewash.

Maybe two key phrases to sell in court. I smell something rotting in Sacramento.

PS. This ordeal may open other doors on liebel and character assinations to sue on as well. Make a few lib media outlets back up what they are reporting.

 

[agricola]

Jim,

In that case, that is outrageous, especially this part of the settlement:

[quote.... plus give $500,000 to the University of California, Berkeley's Institute of Government Studies for research on training poll workers for electronic voting.[/quote]

I presume the training will be for and using Diebold machines? I know nothing about California law, but personally the contempt that Diebold and Lockyer seem to have for it (and for the taxpayer) is something that really needs to be exposed.

good luck

 

[Jim March]

As heard on the Randi Rhodes show on Air America:
http://forum.therandirhodesshow.com/index.php?act=SF&f=45

Inside the Air America Randi Rhodes discussion forum, you'll find this link to DU:
http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=104x2636130

You're misinterpreting the intent. The machines *need* auditing - a proper job isn't being done by the elections officials. What Bev was organizing was planned months in advance and was set to happen regardless of who won.

Yes, a lot of Kerryites are jumping on board because they see an opportunity. But that is NOT going to affect the quality of the data analysis done.

If Bush didn't really win FL or OH, we have to know that. It probably still won't change who gets to live in the white house, it'll be too late, but we can at least fix the damn machines. IF there was fraud, even if it came out "our way", long term it's a recipe for civil war if we don't get this right.

 

[R.H. Lee]

IF the machines are auditable, and it turns out there was fraud and Kerry actually won, Bush will be required to step down and Kerry will replace him. Either that or civil war would be likely, IMO.

 

[agricola]

IF the machines are auditable, and it turns out there was fraud and Kerry actually won, Bush will be required to step down and Kerry will replace him. Either that or civil war would be likely, IMO.

riley I dont know what you are saying but if there was fraud, and Bush won because of it then he shouldnt be in the White House.

 

[M1911Owner]

Once the electors have voted, and the Congress has accepted the vote of the Electoral College, I know of no constitutional mechanism whereby Bush could step down and have Kerry replace him. Bush could step down, and then Cheney would become president. If they both stepped down, then, IIRC, the Speaker of the House becomes the president. (I could be wrong on that last point.) In no case would Kerry become president.

 

[Bruce H]

A better question might be did Diebold elect Lockyer? Could this quickie settlement be his payback?

 

[R.H. Lee]

A better question might be did Diebold elect Lockyer? Could this quickie settlement be his payback?

Off the top of my head, but IIRC Lockyer was re-elected in 2002. I don't remember using Diebold machines then (in my precinct anyway). We used punch cards, which then went to the county clerk recorders office for tabulation.

And yes, Agri, that's what I'm saying. But any such determination has to be made on irrefutable fact, not leftist improvable speculation and fantasy.

 

[Jim March]

Motives are a whole 'nuther complex issue, esp. when we're talking about Lockyer.

I figured as a Democrat, there'd be at least a chance he'd want to get to the bottom of all this. And it's still possible (strike that, *likely*) this is just a blunder on the part of underlings.

I doubt Diebold has prior connections to Lockyer. Shelley maybe...

Speaking of Shelley: it's possible I guess that this is part of an effort to tamp down ALL possible "election related loose ends" to try and give Shelley enough breathing room to recover from his "scandal explosion". Still doesn't really make sense though...

 

[flatrock]

Were Diebold machines even used in Ohio? I was under the impression that OH Sec of State Kenneth Blackwell banned the use of Diebold machines over security concerns. We used punch cards in the precinct I voted in.

 

[Waitone]

Bummer of major magnitude.

You might consider opening another business. In addition to your work with Cali gun laws and Cali voter fraud, you might begin monitoring campaign finance contribution to various politicians, oh, say Lockyer.

Reading the stories I got the distinct whiff of payoff (legal of course), but payoff nonetheless.

 

[bg]

Jim, Lockyer isn't going to rain on Diebold's party. After all he will more than
likely want to run for the Gov's chair in 06. He needs votes for that. I don't
think he'll want to bite the hand or machine that may help him get what he's
really after, regardless if it works correctly or not. Votes are everything as
far as Willy Billy is concerned..

 

[Standing Wolf]

We're going to fight this tooth and nail.

My hat's off to you! Keep up the good work, please!

 

[Jim March]

http://sfgate.com/cgi-bin/article.cgi?f=/c/a/2004/11/11/BAG869PCU31.DTL

San Francisco Chronicle

Settlement in electronic voting lawsuit

Greg Lucas, Chronicle Staff Writer

Thursday, November 11, 2004

Sacramento -- Attorney General Bill Lockyer announced a $2.6 million settlement Wednesday with Texas-based Diebold Elections Systems, seeking to end a lawsuit that alleged the company made false claims about one of its electronic voting systems.

The settlement in the lawsuit, which was filed jointly with Alameda County, must still be approved by a court. If approved, it would provide for reimbursement of some of Alameda County's election costs.

"This settlement holds Diebold accountable and helps ensure the future quality and security of its voting systems," Lockyer said in a statement.

Of the $2.6 million Diebold had agreed to pay, $1.63 million would go to the state and $475,000 to Alameda County.

A statement by the company said that while it had "strong responses" to the claims in the lawsuit, it was better to strike a deal.

"We are primarily interested in building an effective and trusting relationship with California election officials so that we can work together in building election solutions that address the state's needs," said Thomas W. Swidarski, who oversees Diebold's elections systems subsidiary.

But a critic of electronic voting who is a party to the lawsuit said the settlement did not address serious flaws in Diebold's vote tabulation software.

"It's completely without security; it's completely hackable,'' said Bev Harris, the author of "Black Box Voting: Ballot Tampering in the 21st Century."

Although Harris is entitled to some of the proceeds from the settlement, she does not have veto power over the final disposition of the case, said Lockyer spokesman Tom Dresslar.

Lockyer's legal action stemmed in part from claims Diebold made to the secretary of state's office in 2003 that federal certification was imminent for one of its voting systems being purchased by several California counties.

An October 2003 audit by Secretary of State Kevin Shelley also found Diebold had installed software not certified by the state in the 17 counties using Diebold systems.

Both Alameda and San Diego counties had problems with the encoders for its Diebold electronic voting systems in the March primary. Neither county experienced the same problems in last week's election, although Alameda used a different encoder.

In April, Shelley yanked state approval of a Diebold touch-screen voting system used in Solano, San Joaquin, Kern and San Diego counties because it still lacked federal approval.

The settlement requires Diebold to reimburse San Joaquin, Kern and San Diego counties for the costs of switching to another voting system in the November election, something the company had already pledged to do. Solano County reached a separate settlement with Diebold earlier.

Ten other counties were allowed to use electronic voting systems in the presidential election but only after making several security and accuracy upgrades demanded by Shelley. All of those counties had to have paper ballots at polling places in case the electronic systems failed.

Of those 10 counties, only Alameda and Plumas have systems made by Diebold. Under the settlement, Diebold would pay 25 percent of the costs Alameda and Plumas counties incurred for having to offer paper ballots.

If Alameda requests it, Diebold would also pay for upgrades in vote- counting software and for new encoders.

Diebold has already adopted several of the security measures sought by Shelley when he banned one of the company's systems in April, Lockyer said. Among those measures are allowing counties to create their own security passwords rather than use the company's.

The settlement also calls for Diebold to pay $500,000 to UC Berkeley's Institute of Governmental Studies to fund research on how to better train poll workers in the use of electronic voting technology.

The complaint is an expanded version of a lawsuit filed by Harris and James March, another critic of electronic voting systems. The court will consider their views before a final settlement is approved.

E-mail Greg Lucas at [email protected].