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The strange twists and turns of an alleged election conspiracy

Catherine Engelbrecht, founder of True the Vote, and her partner Gregg Phillips. (Bridget Bennett/Reuters)

This article has been updated with new developments in the case

For months, a small Michigan company that sells software to help municipalities manage work schedules and payroll accounts of election workers has been under scrutiny by two prominent members of a conservative “election integrity” group based in Texas that has helped spread false fraud claims about the 2020 election.

Catherine Engelbrecht, founder of True the Vote, and her partner Gregg Phillips alleged that the company, Konnech Inc., had allowed the Chinese government to have access to a server in China that held the personal information of nearly 2 million U.S. election workers an allegation the company has vigorously disputed.

Then, just days after the New York Times published an account of the company being a “conspiracy theory target,” the Los Angeles district attorney announced that its chief executive, Eugene Yu, had been arrested on charges that appeared to mirror the claims of the election deniers. True the Vote even issued a news release taking credit for inspiring the DA’s investigation — and Phillips said in a legal filing he had testified before a grand jury to assist the DA.

It seemed a rare case of an alleged election-conspiracy theory potentially having a factual basis. Yet, in a parallel track in another courtroom, a federal judge in Texas has blasted Phillips, Engelbrecht and True the Vote for their allegations about Konnech. The judge, Kenneth M. Hoyt, nominated to the bench by Ronald Reagan, even warned the group’s lawyer that “I’m thinking you may be played” by his clients. Hoyt said in an order Oct. 17 that he would hold the election deniers in contempt for not complying with a temporary restraining order he had issued in September.

The outcome of this complex case may not be clear for some time. But it indicates how election deniers have begun to gain a foothold within the legal system to advance their claims.

The election deniers

Phillips first gained attention when he claimed without providing evidence just days after the 2016 election that he had “verified” that more than 3 million votes had been cast by noncitizens — just enough to wipe out Hillary Clinton’s margin in the popular vote tally. President-elect Donald Trump avidly repeated the claim.

Phillips never explained how he made this calculation. He and Engelbrecht announced a fundraising effort to conduct an audit to verify the statement. But the audit never materialized. Engelbrecht, in a 2017 video posted on YouTube, said not enough donations were received to finish the job.

More recently, Phillips and Engelbrecht were executive producers of a widely debunked documentary embraced by Trump, “2000 Mules,” that claims Democrats engaged in voter fraud to steal the 2020 election from Trump. Phillips said he had assembled geolocation data to identify people who allegedly traveled to multiple ballot drop boxes as part of the conspiracy.

Again, evidence to support such claims was lacking. In fact, the Georgia State Elections Board investigated the allegations and concluded the ballots belonged to legal voters and were deposited by qualifying household members. But the video, released this year, was a big hit. It had grossed $10 million in revenue, with more than 1 million views, just two weeks after its release, according to Salem Media Group, which financed the film.

Starting in 2021, Phillips and Engelbrecht also turned their sights on Konnech.

A Michigan software company

Yu, 65, a native of China, founded Konnech in 1999 after earning an MBA from Wake Forest University and two years after becoming a U.S. citizen. The company, with about two dozen employees, produces a software program called PollChief, used by more than 30 municipalities to manage election workers, including in Los Angeles County.

The company has said that U.S. election worker data has never been stored overseas.

“Konnech’s software products are not and have never been involved in voter registration or ballot counting,” Yu’s attorney, Gary S. Lincenberg, said in an Oct. 21 filing seeking a review of Yu’s bail requirements. He added: “Konnech hosts all customer data exclusively in its country of origin. This means that data belonging to Konnech’s United States customers, including Los Angeles County, is hosted only on secure servers within the United States.”

Yet, in August, Phillips and Engelbrecht appeared at a True the Vote conference in Arizona in which they suggested Konnech was working with the Chinese Communist Party — and that information about election workers was stored on three servers that are physically in Wuhan, China. They said they began investigating the company in 2021, gaining access to its database with the help of others — “some kind of James Bond kind of thing,” Phillips said on one podcast — and downloading personal information on 1.8 million poll workers.

In a video interview later that month, Phillips said the group formally reported its findings to the FBI and the director of national intelligence with the hope of ensuring the software was discontinued before the 2022 election. But then, he claimed, despite enthusiastic interest from lower-level agents, the FBI leadership “made us the target … [and] they turned this whole thing on us,” for allegedly hacking into Konnech’s systems.

Konnech’s suit — and Yu’s arrest

On Sept. 12, Konnech filed suit in Texas against True the Vote, Phillips and Engelbrecht, accusing them of a “unique brand of racism and xenophobia” that had damaged Konnech’s business and led Yu and his family to flee their home.

Hoyt granted a temporary restraining order the same day, saying the evidence presented showed the company “had a substantial likelihood of success” in winning its lawsuit. He barred True the Vote from accessing Konnech’s computers and ordered the group to identify who accessed the company’s computers.

Then, on Oct. 6, Yu was arrested in Michigan, Los Angeles County District Attorney George Gascón announced. His news release said the arrest concerned the “possible theft of personal identifying information” and stressed the “alleged conduct had no impact on the tabulation of votes and did not alter election results.”

But the statement also echoed a key claim made by Phillips and Engelbrecht — that personal data of poll workers resided in China.

“Under its $2.9 million, five-year contract with the county, Konnech was supposed to securely maintain the data and that only United States citizens and permanent residents have access to it,” the news release said. “District Attorney investigators found that in contradiction to the contract, information was stored on servers in the People’s Republic of China.”

Meanwhile, in his courtroom on Oct. 6, Hoyt was undeterred by the report of the arrest. “On the verge of this proceeding, of this hearing, suddenly the plaintiff gets arrested so he can’t show up in court,” he noted, telling attorneys for True the Vote that he didn’t “have any confidence” in their clients’ assertions. He forced one attorney to reveal in open court the name of the person who allegedly helped True the Vote access Konnech’s systems, dismissing concerns that his safety might be in danger. “There are no secrets in this courtroom,” he said. “I want to know names.”

Hoyt also elicited acknowledgment from True the Vote’s lawyer that he had “no personal knowledge” of any FBI investigation, despite Phillips’s claim he had participated in one.

The DA’s changing story

Initially, the DA’s office told reporters that True the Vote played no role in the investigation. But True the Vote issued its own news release, saying it was “honored to have played a small role in what must have been a wide ranging and complex investigation.”

Then, the DA’s office began to acknowledge to reporters that True the Vote had played a role.

“Phillips’ report to PID [Public Integrity Division] was the first step in a thorough independent and still ongoing investigation which ultimately led to the arrest and charging of Mr. Yu,” Gascón’s office said in a statement to the Fact Checker. “We initially indicated that Mr. Phillips played no role in the investigation. While we performed an independent investigation,” the statement continued, Phillips’s report “did in fact result in us initiating our investigation.”

In an Oct. 12 court filing in the Texas case, Phillips said he had testified before a grand jury investigating Yu and that an indictment of Yu soon would be unsealed. He argued that complying with aspects of the temporary restraining order “would jeopardize national security.” The DA’s office declined to comment on Phillips’s claim. A representative of True the Vote said they could not comment on Konnech because of the judge’s order.

A day later, the DA’s office did not unseal any indictment but instead issued a criminal complaint against Yu, charging him with engaging in a conspiracy to embezzle public funds. While both carry the same weight, an indictment would have revealed more clearly Phillips’s role in the case. Moreover, the complaint did not repeat the statement in the news release that information was stored on servers in China. Instead, the DA said the company relied on third-party contractors based in China — not an uncommon practice in a globalized world.

“The District Attorney’s Office discovered that Konnech employees known and unknown sent personal identifying information of Los Angeles County election workers to third-party software developers who assisted with creating and fixing Konnech’s internal ‘PollChief’ software,” the complaint said.

In Yu’s request for bail modification, his attorney disputed this claim, saying software developers in China did not receive actual personal data from the company. “Like most tech companies, Konnech works with employees and contractors across the globe,” the filing said. “For example, programmers in China help develop and test computer code for Konnech, generally using generic ‘dummy’ data, or sanitized data, created specifically for testing purposes.”

With the filing of the complaint, the DA’s office was required to provide its evidence for the charges to the defenseand Yu’s attorney seized on the apparently shifting claims. “Contrary to the prosecutor’s statement to the court, the discovery reveals no disclosure of PII [personal identifying information] to anyone outside of the United States,” Yu’s lawyer wrote. “Nor does it suggest the release of any PII to persons unaffiliated with Konnech” or that “any information was improperly shared with contractors or stored on servers in China.”

In court on Oct. 14, prosecutor Eric Neff asserted “this is arguably the largest data breach in United States history” — an apparent reference to the 1.8 million figure used by True the Vote. Konnech says that it never had records on more than 250,000 workers at a time, scattered among different databases.

In a filing Oct. 25 opposing changing the terms of Yu’s bail because of “the high risk of flight” to China, the DA’s office scaled back its allegations even further. “Under the Defendant’s direction, Konnech actually exposed the PII of tens of thousands of County workers to possible compromise in violation of his agreement with the County,” the filing said.

Under the initial terms of his bail, Yu was confined to a Los Angeles hotel room. Despite the DA’s opposition, a judge modified the bail conditions to remove home confinement and allow him to return to Michigan and communicate with his employees. On Oct. 27, Yu’s attorney filed a brief requesting dismissal of the criminal charges. “This is a deeply misguided prosecution that attempts to criminalize what is, at best, a civil breach of contract claim involving poll worker management software,” Lincenberg argued.

On Nov. 9, the DA’s office dropped the criminal charges against Hu. “We are concerned about both the pace of the investigation and the potential bias in the presentation and investigation of the evidence,” the office said in a statement. “As a result, we have decided to ask the court to dismiss the current case, and alert the public in order to ensure transparency.”

Meanwhile, in Hoyt’s courtroom on Oct. 27, both Phillips and Engelbrecht took the stand and answered some questions from Konnech’s attorney. But they refused to reveal the name of another person allegedly involved in accessing Konnech’s data, suggesting the person was a confidential FBI informant. Hoyt told them they had until 9 a.m. Oct. 31 to reveal the name or else he would order them to be jailed.

“We were held in contempt of court because we refused to burn a confidential informant or our researchers,” Phillips posted on Truth Social after the hearing. “We go to jail on Monday unless we comply.” They refused and so Hoyt found them in contempt and ordered them to jail. They were released a week later after appealing his ruling.

Yu’s arrest led many municipalities to suspend their contracts with Konnech, including Fairfax County and Prince William County in Virginia. But Dean C. Logan, the Los Angeles county registrar, said the county would continue to use Konnech’s software for the coming election, notwithstanding the criminal complaint filed by the county’s district attorney.

“Konnech has affirmed their compliance with the contract and at this time, no information has been provided to the Department confirming storage of data outside the United States or specific information as to what data is associated with the allegations,” Logan said in a statement. “Absent confirmation and/or additional information specific to the County’s data, use of the application has continued with security oversight and contract monitoring to ensure against disruption to the current election.”

Now the race is on for both sides to win approval for their actions in the respective courtrooms.

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