The Department of Justice is expected to file a lawsuit at month’s end to block the already-completed merger of the nation’s two largest voting-machine makers, including one that will service the city, The Post has learned.
According to a person close to the situation, the Justice Department’s lawsuit, if successful, would effectively undo the merger of Diebold’s Premier Elections Solutions with Election Systems & Software, a $5 million deal completed in September.
The Post last month reported that antitrust officials at the Justice Department were examining the ES&S-Diebold marriage because the deal would give ES&S up to 75 percent of the voting-machine market, which has triggered worry among voting-rights activists and rivals who argue the deal gives ES&S too much power and little incentive to improve its products.
So far, in addition to the Justice Department, 14 states have opened investigations into the tie-up. Sen. Chuck Schumer (D.-NY) has indicated he wants to hold hearings as well.
ES&S last week won a $70 million contract to supply New York City with between 5,000 and 7,000 electronic touch-screen voting machines. ES&S also landed a contract with Nassau County.
A city Board of Elections source said the contract involves ES&S machines only and does not include its recently acquired Diebold products, which suggests an unwinding of the deal would not likely affect that contract.
“We were aware there was a DOJ review but were looking at buying models they presented to us two years ago [well before the Diebold purchase]. I can’t see how this in any way impacts us,” the source said.
ES&S, Diebold and the Justice Department did not return calls seeking comment.
Before winning the local contracts, Nebraska-based ES&S had nearly 50 percent of the US market, with Diebold second with about 25 percent. No other voting machine maker has greater than a 10 percent share.
This would mark the first suit to block a merger in the Obama administration’s Justice Department, according to the person close to the situation.
The administration has been warning corporate America that it would take a harder look at mergers for antitrust implications.
The Justice Department is reviewing planned mergers of concert promotion companies Live Nation and Ticketmaster, as well as the $37 billion tie-up between NBC Universal and Comcast.