Pentagon admits it's now probing conflicts of interest at AWS over $10bn JEDI cloud deal

Earlier investigation would've been 'premature'

The US government has confirmed it is investigating whether Amazon's decision to rehire a former Pentagon staffer poses a conflict of interest to the $10bn JEDI cloud contract.

Oracle is suing the US Department of Defense (DoD) over the 10-year mega-cloud contract, in which AWS is widely seen as a frontrunner.

Big Red is contesting the decision to hand the award to one company, alleging that the DoD artificially crafted "gate criteria" to limit the number of vendors that could apply and that DoD staffers had inappropriate links to AWS.

The US government had insisted the contracting officer had identified the possibility for bias in the two former employees named by Oracle – Deap Ubhi and Anthony DeMartino – but concluded that neither of their involvement had negatively impacted the work.

However, in its latest online filing in the US court system, the government revealed it was again investigating Amazon's rehiring of Ubhi, on the basis that AWS had applied for the contract.

Ubhi worked at Amazon until January 2016, and six months later joined the Defense Digital Service for a period of 18 months, at which point he resigned to work for Amazon again.

In the filing, the government said Ubhi was cleared to work on the JEDI procurement by DoD counsel because his employment with Amazon ended more than one year before the procurement began.

He was then involved in the initial stage of the procurement process, which included meetings with cloud providers and other experts, but recused himself in October 2017 because Amazon was sniffing around a company he owned.

The US said his involvement in JEDI ended before the Pentagon had received any responses to its initial request for information or drafted "the bulk of its acquisition strategy documents" or draft solicitation terms.

But one of Oracle's issues is that Ubhi rejoined AWS in November 2017, arguably taking his insider knowledge with him.

In a separate filing, Oracle called for access to various materials that Ubhi would have had access during his time at the DoD, and about the assessment of Ubhi's conflict of interest, arguing that these materials should be put on the administrative record.

For instance, Oracle criticised the contracting officer's investigation because Ubhi wasn't asked when his re-employment negotiations with AWS began. It pointed to the fact his recusal letter referred to "further" discussions with the firm, but that government rules state any discussions require "immediate recusal".

The US has repeatedly insisted that the contracting officer's investigation of Ubhi was sufficient and that "no further investigation" was necessary before proposals were submitted. But, it said, now Amazon has submitted a proposal, an investigation is necessary.

"The contracting officer did not analyze whether Amazon's re-hiring of Mr Ubhi in November 2017 created an OCI [organizational conflict of interest] because Amazon had not yet submitted a proposal, so the contracting officer considered that inquiry to be premature.

"Now that Amazon has submitted a proposal, the contracting officer is considering whether Amazon's re-hiring Mr Ubhi creates an OCI that cannot be avoided, mitigated, or neutralized."/p>

Despite this, the government is arguing that Oracle's efforts to add to the existing administrative record for the contract with depositions of the two former employees and other internal DoD documents are inappropriate.

"Oracle seeks to engage in a broad fishing expedition primarily to find support for its claim that the solicitation at issue is tainted by alleged conflicts of interest involving two former Department of Defense (DoD) employees and defendant-intervenor, Amazon Web Services, Inc. (Amazon)," the US said.

It argued Oracle's bid protest should be limited to the documentation developed and considered in making the decision at issue in the litigation – the conditions in the contract and that it is being awarded to a single vendor – and not seeking fresh information.

"Oracle is effectively requesting that the Court conduct an improper de novo review into whether DeMartino and Ubhi's involvement had negatively impacted the integrity of the procurement, rather than review the rationality of the contracting officer's no impact determinations."

If the court ruled that the officer's investigations were inadequate, then it "should remand to the agency for further investigation, not conduct its own investigation".

Elsewhere in the US government's submission, it defended the decision to award the contract to one vendor. It reiterated previous arguments that a multiple vendor award would achieve less favourable pricing terms, create "seams between clouds that increase security risks", "frustrate DoD's attempts to consolidate" data for analytics, and "exponentially increase" technical complexities in the cloud. ®

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