DOD's IG finds no political interference in JEDI award

The Defense Department's inspector general said he could not find any political interference in the JEDI award to Microsoft even though the White House ordered officials not to answer questions about communications between DOD and the Administration.

The Defense Department inspector general’s long-awaited report on the JEDI cloud infrastructure procurement was released Wednesday -- at a total of 313 pages -- that at best is a mixed bag for the contract’s two finalists.

On one hand, the IG concludes in its review started last June that any possible senior-level discussions between White House and DOD officials did not influence or put pressure on the decision by procurement officials to make the final award to Microsoft late last year over Amazon, a target of President Trump’s personal animus along with founder and CEO Jeff Bezos.

DOD conducted the solicitation and source selection process in line with established standards and acquisition regulations, the IG said, and that includes the much-debated single-award method. Department officials that auditors spoke to said they did not feel pressured by Trump's anti-Amazon and anti-Bezos comments. The department also made an apparent misstep after the award that gave AWS proprietary information including some pricing about Microsoft’s JEDI bid that impacted the debriefing. 

But the matter of possible political interference at the crux of Amazon Web Services’ ongoing lawsuit over the contract was also not completely answered. The IG said it could not review the matter fully after the White House asserted “presidential communications privilege,” after which DOD lawyers directed department officials to not speak with the IG about any potential discussions with the White House about JEDI.

"The Inspector's General 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. The IG's team found that there was no influence by the White House or DoD leadership on the career source selection boards who made the ultimate vendor selection,” DOD spokeman Lt. Col. Robert Carver said in a statement. “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 frontline warfighters while continuing to protect American taxpayers."

“The Inspector General’s report makes clear the DOD established a proper procurement process. It’s now apparent that Amazon bid too high a price and is seeking a do-over so it can bid again. As the IG’s report indicates, Amazon has proprietary information about Microsoft’s bid that it should never have had. At this stage, Amazon is both delaying critical work for the nation’s military and trying to undo the mistake it made when it bid too high a price,” Microsoft spokesman Frank Shaw said in a statement.

For its part, AWS is not satisfied with the outcome and believes there is more to the story.

“This report doesn’t tell us much. It says nothing about the merits of the award, which we know are highly questionable based on the Judge’s recent statements and the government’s request to go back and take corrective action," an AWS spokesperson said in an emailed statement to reporters. "It's clear that this report couldn’t assess political interference because several DOD witnesses were instructed by the White House not to answer the IG’s questions about communications between the White House and DOD officials. 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.”

White House counsel was only willing to let witnesses give written answers that would first be reviewed internally to see if they were covered by that privilege before going to the IG, which declined the offer. DOD attorneys also told department officials to decline to answer questions about communications with the White House.

One communication with the White House did come out. In July, DOD Chief Information Officer Dana Deasy briefed then-acting White House Chief of Staff Mick Mulvaney on JEDI and subsequently contacted Deputy Chief of Staff Chris Lidell on how to get “correct information” about the procurement to Trump. Lidell replied that Trump “was not engaging anyone on the topic.”

The IG’s report also details some of what took place before and after the award to Microsoft in October of last year. Former Defense Secretary James Mattis and former Deputy Defense Secretary Patrick Shanahan told the IG that they could not remember any conversations with Trump about JEDI, including a reported directive from Trump to Mattis to “screw Amazon” out of the contract.

A key event in the timeline is Defense Secretary Mark Esper’s recusal from the JEDI process on Oct. 7 due to his son’s employment with IBM, one of the initial four competitors. Esper told the IG he believes he first learned of IBM’s pursuit of JEDI in September 2019.

Esper’s review was then restructured to focus on the procurement’s “path forward” and not “who would get the contract.” Deputy Defense Secretary David Norquist took over after Esper stepped back.

AWS submitted 265 questions to DOD contracting officials as part of the post-award enhanced debriefing process and appear to have received answers on 126 of them. Twenty-five questions were considered entirely outside the debriefing scope under federal acquisition regulations. Along with allegations of political interference, AWS is also objecting to the debriefing process as part of its lawsuit at the Court of Federal Claims.

From there, 114 questions were determined outside the debriefing scope after DOD discovered an accidental disclosure of sensitive information about Microsoft’s JEDI proposal. DOD officials apparently figured out those questions were so specific and then found 13 reports from the JEDI technical evaluation board that were disclosed to AWS.

The IG attributes the disclosure to a series of misunderstandings between DOD contracting officials and department lawyers in the lead up to the final award. Attorneys for DOD advised department leaders to conduct the debriefs with both companies in writing instead of in-person.

Work on JEDI is currently on hold due to an injunction handed down in February by Court of Federal Claims Judge Patricia E. Campbell-Smith in the case AWS brought there. She is also reviewing a proposal by DOD to undertake a corrective action and accept limited proposal revisions from AWS and Microsoft.

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