House urged to probe Smartmatic-Dominion squabble

MANILA, Philippines - Party-list representatives on Tuesday urged the House of Representatives' committee on suffrage to hold a congressional inquiry on the legal cases between voting machines supplier Smartmatic International Corp. and Dominion Voting Systems International Corp.

"The interest of the Filipino people in the legal controversy between Smartmatic and Dominion arises from the possibility that Smartmatic may have been liable for misrepresentation or fraud when it entered into a Deed of Sale with the Commission on Elections, to the prejudice of the Filipino people and the jeopardy of the upcoming automated polls next year," Bayan Muna Rep. Neri Colmenares said in a statement.

Colmenares and other party-list representatives, Luzviminda Ilagan of Gabriela and Antonio Tinio of Act Teachers, have filed House Resolution 2849 asking the suffrage committee to look into the legal squabble between the two companies.

The Bayan Muna representative said the probe will determine whether the Comelec possessed all the information regarding the "goods" it purchased - the technology of the Precinct Count Optical Scan machines - and the Smartmatic's capacity to fulfill its obligations and promises at the time when the option to purchase was exercised and during the execution of the Deed of Sale.

The resolution states that on September 11, 2012, Smartmatic filed with the Court of Chancery of the State of Delaware a complaint against Dominion, which complaint stemmed from the PCOS Framework License Agreement executed between the two, under which Dominion, the owner of the optical scan voting system technology, granted to Smartmatic the license to exploit said technology, including its marketing to other countries outside the United States.

The complaint alleges that Dominion failed to honor its commitments to Smartmatic and has interfered with its business of developing and providing for the automated election systems in Mongolia, Puerto Rico, and the Philippines.

The Smartmatic complaint indicates that the ownership of and full control of the PCOS technology is deeply embroiled in legal dispute and that Smartmatic has no full control over the same, so as to enable it to make the changes necessary for the technology to be fully compliant with Republic Act 9369 and other Philippine Laws, the Resolution states.

The Smartmatic's complaint came after Dominion cancelled a 2009 license agreement with Smartmatic last May.

Comelec Chairman Sixto Brillantes said that the legal battle between the two companies is purely business-related and it should not a cause for panic.

Brillantes assured the public that the squabble between Smartmatic and Dominion will not affect the technological aspect of the contract.

SC ruling

The Supreme Court upheld last July the validity and constitutionality of the Comelec's purchase of the voting machines from Smartmatic.

Colmenares said that the high court arrived at the decision without being informed of the legal controversy between Smartmatic and Dominion.

"The Highest Court upheld the Comelec's exercise of the option to purchase the goods but on the assumption that despite palpable infirmities and defects in the goods, Smartmatic can provide the enhancements required and requested by Comelec and Philippines laws," Colmenares said.

The party-list representatives said in the resolution that Smartmatic has no such capacity at the time of the execution of the Deed of Sale and even until present, seven months before the 2013 elections.

The resolution also said that "following the allegations in the complaint, the continuing refusal of Dominion to recognize the License Agreement obligating Dominion to provide the enhancements, improvements and modifications needed and requested by the Comelec, is detrimental to the Philippine elections, as well as renders the contract between the Comelec and Smartmatic defective."

"This would only mean that Smartmatic could not possibly comply with the conditions set forth by Comelec in the Deed of Sale until and unless the State of Delaware rules in its favor and rule immediately," Colmenares said.