September 11, 2024

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NJ court permits release of post-trial briefs in voting case

October 27, 2010 by

In 2009 the Superior Court of New Jersey, Law Division, held a trial on the legality of using paperless direct-recording electronic (DRE) voting machines. Plaintiffs in the suit argued that because it’s so easy to replace the software in a DRE with fraudulent software that cheats in elections, DRE voting systems do not guarantee the substantive right to vote (and to have one’s vote counted) required by the New Jersey constitution and New Jersey statutory law.

I described this trial in three articles last year: trial update, summary of plaintiffs’ witnesses’ testimony, and summary of defense witnesses’ testimony.

Normally in a lawsuit, the courtroom is open. The public can attend all legal proceedings. Additionally, plaintiffs are permitted to explain their case to the public by releasing their post-trial briefs (“proposed findings of fact” and “proposed conclusions of law”). But in this suit the Attorney General of New Jersey, representing the defendants in this case, argued that the courtroom be closed for parts of the proceedings, and asked the Court to keep all post-trial documents from the public, indefinitely.

More than a year after the trial ended, the Court finally held a hearing to determine whether post-trial documents should be kept from the public. The Attorney General’s office failed to even articulate a legal argument for keeping the briefs secret.

So, according to a Court Order of October 15, 2010, counsel for the plaintiffs (Professor Penny Venetis of Rutgers Law School aided by litigators from Patton Boggs LLP) are now free to show you the details of their legal argument.

The briefs are available here:
Plaintiffs’ Proposed Findings of Fact
Plaintiffs’ Proposed Conclusions of Law

I am now free to tell you all sorts of interesting things about my hands-on experiences with (supposedly) tamper-evident security seals. I published some preliminary findings in 2008. Over the next few weeks I’ll post a series of articles about the limitations of tamper-evident seals in securing elections.

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Court permits release of unredacted report on AVC Advantage

October 13, 2010 by

In the summer of 2008 I led a team of computer scientists in examining the hardware and software of the Sequoia AVC Advantage voting machine. I did this as a pro-bono expert witness for the Plaintiffs in the New Jersey voting-machine lawsuit. We were subject to a Protective Order that, in essence, permitted publication of our findings but prohibited us from revealing any of Sequoia’s trade secrets.

At the end of August 2008, I delivered my expert report to the court, and prepared it for public release as a technical report with the rest of my team as coauthors. Before we could release that report, Sequoia intervened with the Court, claiming that we were revealing trade secrets. We had been very careful not to reveal trade secrets, so we disputed Sequoia’s claim. In October 2008 the Court ruled mostly in our favor on this issue, permitting us to release the report with some redactions,and reserving a decision on those redacted sections until later.

The hearing on those sections has finally arrived, completely vindicating our claim that the original report was within the parameters of the Protective Order. On October 5, 2010 Judge Linda Feinberg signed an order permitting me to release the original, unredacted expert report, which is now available here.

If you’re curious, you can look at paragraphs 19.8, 19.9, 21.3, and 21.5, as well as Appendices B through G, all of which were blacked out in our previously released report.

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Did a denial-of-service attack cause the flash crash? Probably not.

October 2, 2010 by

Last June I wrote about an analysis from Nanex.com claiming that a kind of spam called “quote stuffing” on the NYSE network may have caused the “flash crash” of shares on the New York Stock Exchange, May 6, 2010. I wrote that this claim was “interesting if true, and interesting anyway”.

It turns out that “A Single Sale Worth $4.1 Billion Led to the ‘Flash Crash’“, according to a report by the SEC and the CFTC.

The SEC’s report says that no, quote-stuffing did not cause the crash. The report says,

It has been hypothesized that these delays are due to a manipulative practice called “quote-stuffing” in which high volumes of quotes are purposely sent to exchanges in order to create data delays that would afford the firm sending these quotes a trading advantage.

Our investigation to date reveals that the largest and most erratic price moves observed on May 6 were caused by withdrawals of liquidity and the subsequent execution of trades at stub quotes. We have interviewed many of the participants who withdrew their liquidity, including those who were party to significant numbers of buys and sells that occurred at stub quote prices. …[E]ach market participant had many and varied reasons for its specific actions and decisions on May 6. … [T]he evidence does not support the hypothesis that delays in the CTS and CQS feeds triggered or otherwise caused the extreme volatility in security prices observed that day.

Nevertheless … the SEC staff will be working with the market centers in exploring their members’ trading practices to identify any unintentional or potentially abusive or manipulative conduct that may cause such system delays that inhibit the ability of market participants to engage in a fair and orderly process of price discovery.

Given this evidence, I guess we can simplify “interesting if true, and interesting anyway” to just “interesting anyway”.

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Did a denial-of-service attack cause the stock-market "flash crash?"

June 25, 2010 by

On May 6, 2010, the stock market experienced a “flash crash”; the Dow plunged 998 points (most of which was in just a few minutes) before (mostly) recovering. Nobody was quite sure what caused it. An interesting theory from Nanex.com, based on extensive analysis of the actual electronic stock-quote traffic in the markets that day and other days, is that the flash crash was caused (perhaps inadvertently) by a kind of denial-of-service attack by a market participant. They write,

While analyzing HFT (High Frequency Trading) quote counts, we were shocked to find cases where one exchange was sending an extremely high number of quotes for one stock in a single second: as high as 5,000 quotes in 1 second! During May 6, there were hundreds of times that a single stock had over 1,000 quotes from one exchange in a single second. Even more disturbing, there doesn’t seem to be any economic justification for this.

They call this practice “quote stuffing”, and they present detailed graphs and statistics to back up their claim.

The consequence of “quote stuffing” is that prices on the New York Stock Exchange (NYSE), which bore the brunt of this bogus quote traffic, lagged behind prices on other exchanges. Thus, when the market started dropping, quotes on the NYSE were higher than on other exchanges, which caused a huge amount of inter-exchange arbitrage, perhaps exacerbating the crash.

Why would someone want to do quote stuffing? The authors write,

After thoughtful analysis, we can only think of one [reason]. Competition between HFT systems today has reached the point where microseconds matter. Any edge one has to process information faster than a competitor makes all the difference in this game. If you could generate a large number of quotes that your competitors have to process, but you can ignore since you generated them, you gain valuable processing time. This is an extremely disturbing development, because as more HFT systems start doing this, it is only a matter of time before quote-stuffing shuts down the entire market from congestion.

The authors propose a “50ms quote expiration rule” that they claim would eliminate quote-stuffing.

I am not an expert on finance, so I cannot completely evaluate whether this article makes sense. Perhaps it is in the category of “interesting if true, and interesting anyway”.

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No Warrant Necessary to Seize Your Laptop

January 27, 2010 by

The U.S. Customs may search your laptop and copy your hard drive when you cross the border, according to their policy. They may do this even if they have no particularized suspicion of wrongdoing on your part. They claim that the Fourth Amendment protection against warrantless search and seizure does not apply. The Customs justifies this policy on the grounds that “examinations of documents and electronic devices are a crucial tool for detecting information concerning” all sorts of bad things, including terrorism, drug smuggling, contraband, and so on.

Historically the job of Customs was to control the flow of physical goods into the country, and their authority to search you for physical goods is well established. I am certainly not a constitutional lawyer, but to me a Customs exemption from Fourth Amendment restrictions is more clearly justified for physical contraband than for generalized searches of information.

The American Civil Liberties Union is gathering data about how this Customs enforcement policy works in practice, and they request your help. If you’ve had your laptop searched, or if you have altered your own practices to protect your data when crossing the border, staff attorney Catherine Crump would be interested in hearing about it.

Meanwhile, the ACLU has released a stack of documents they got by FOIA request.
The documents are here, and their spreadsheets analyzing the data are here. They would be quite interested to know what F-to-T readers make of these documents.

ACLU Queries for F-to-T readers:
If the answer to any of the questions below is yes, please briefly describe your experience and e-mail your response to laptopsearch at aclu.org. The ACLU promises confidentiality to anyone responding to this request.
(1) When entering or leaving the United States, has a U.S. official ever examined or browsed the contents of your laptop, PDA, cell phone, or other electronic device?

(2) When entering or leaving the United States, has a U.S. official ever detained your laptop, PDA, cell phone, or other electronic device?

(3) In light of the U.S. government’s policy of conducting suspicionless searches of laptops and other electronic devices, have you taken extra steps to safeguard your electronic information when traveling internationally, such as using encryption software or shipping a hard drive ahead to your destination?

(4) Has the U.S. government’s policy of conducting suspicionless searches of laptops and other electronic devices affected the frequency with which you travel internationally or your willingness to travel with information stored on electronic devices?

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