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Laurie Clarke

Reporter

Pentagon watchdog concludes no White House pressure in $10bn JEDI contract award to Microsoft 

The US Department of Defense’s award of a $10bn JEDI cloud computing contract to Microsoft was not the result of any wrongful pressure or outside influence, a Pentagon watchdog has found – presenting Microsoft with a victory in its ongoing tussle with Amazon over the decision.

The Defense Department’s Inspector General found in an extensive investigation that despite allegations of presidential favouritism and biased decision making from Amazon and Oracle, the award process was generally consistent with federal procurement laws and policies. 

It concluded that the selection of Microsoft wasn’t the result of pressure from the White House, contrary to Amazon’s allegations that President Trump’s personal antipathy towards the company and its CEO Jeff Bezos had played an instrumental part in the award decision. 

However, it was noted that the investigation itself was hindered by White House assertions of presidential privilege, which blocked Pentagon officials from answering some questions regarding discussions they had with White House officials about the JEDI contract. 

The Pentagon inspector general office said in a news release: “The evidence we received showed that the DoD personnel who evaluated the contract proposals and awarded Microsoft the JEDI Cloud contract were not pressured regarding their decision on the award of the contract by any DoD leaders more senior to them, who may have communicated with the White House.”

The report concludes that despite the surrounding media circus and President Trump’s florid tweets, the integrity of the decision making process wasn’t compromised. “None of these witnesses told us they felt any outside influence or pressure for or against a particular competitor as they made their decisions on the award of the contract.”

However, media reports about the public controversy, including President Trump’s statements, “may have created the appearance or perception that the contract award process was not fair or unbiased,” highlights the report.

Some ethical lapses were identified, with the report noting that DoD official Deap Ubhi, had worked at the Pentagon on the initial development of the JEDI contract, while negotiating new employment with AWS, having worked there prior to his DoD role. However, the report said this was not influential on the outcome of the award – an issue Oracle had raised. 

The Pentagon took the decision as validation for the outcome of the contract award. Lt. Col. Robert Carver said in a statement: “The [Inspector General’s] final report on the JEDI Cloud procurement confirms that the Department of Defense conducted the JEDI Cloud procurement process fairly and in accordance with law. This report should finally close the door on the media and corporate-driven attacks on the career procurement officials who have been working tirelessly to get the much needed JEDI cloud computing environment into the hands of our front-line warfighters.”

Microsoft told the Wall Street Journal that the report: “makes clear the DoD established a proper procurement process.” However, Amazon honed in on the White House’s obstruction of some of the testimony from Pentagon officials, saying “The White House’s refusal to cooperate with the IG’s investigation is yet another blatant attempt to avoid a meaningful and transparent review of the JEDI contract award.” 

What next?

Is this the end of this carnival of disillusionment? Not quite. There is an ongoing court case where Amazon is alleging that the contract was unfairly awarded to Microsoft on the basis of improper evaluation of various elements of the company’s bid. Earlier this year, a judge issued a preliminary injunction preventing any further work on the contract, as well as saying that Amazon would likely succeed on one of its technical challenges. (However, this is now complicated by the revelation in the Pentagon watchdog’s report that Amazon’s claim in the case is based on confidential information that was seemingly sent by accident to the company by a DoD official). 

In its report, the inspector general’s office said: “We do not draw a conclusion regarding whether the DoD appropriately awarded the JEDI Cloud contract to Microsoft rather than Amazon Web Services. We did not assess the merits of the contractors’ proposals or DoD’s technical or price evaluations; rather we reviewed the source selection process and determined that it was in compliance with applicable statutes, policies, and the evaluation process.”