Pentagon Narrows Finalists To Two -- WSJ
April 12 2019 - 3:02AM
Dow Jones News
By John D. McKinnon
This article is being republished as part of our daily
reproduction of WSJ.com articles that also appeared in the U.S.
print edition of The Wall Street Journal (April 12, 2019).
WASHINGTON -- The Pentagon has identified Amazon.com Inc. and
Microsoft Corp. as finalists for its massive cloud-computing
contract, and says the award process will move forward despite
being clouded by "potential ethical violations."
The contract award, worth as much as $10 billion to the winner
over a decade, has been on hold for weeks as the Defense Department
re-examines its procurement process, in response to a legal protest
by one would-be bidder, Oracle Corp.
Oracle contends the acquisition has been skewed to favor Amazon.
The Pentagon said Amazon Web Services and Microsoft have met the
minimum requirements to win the deal and will remain in the
competition. The Pentagon said the soonest it could pick a winner
is mid-July.
Oracle and IBM Corp. were eliminated, although Oracle's bid
protest in the U.S. Court of Federal Claims appears likely to
continue.
"The department's investigation has determined that there is no
adverse impact on the integrity of the acquisition process," said
Elissa Smith, a Department of Defense spokeswoman. "However, the
investigation also uncovered potential ethical violations, which
have been further referred to DOD IG," which is the Defense
Department's Inspector General.
Ms. Smith didn't elaborate on the nature of the potential
violations. She said the Pentagon also will be asking the Court of
Claims to lift a stay on Oracle's protest case that the Defense
Department requested while it investigated the alleged conflicts of
interest.
Oracle's complaint focuses on Deap Ubhi, who worked at Amazon
both before and after his 2016-2017 stint with the federal
government. Oracle has contended that Mr. Ubhi helped steer the
JEDI procurement process to favor Amazon while working at the
Defense Department.
JEDI stands for Joint Enterprise Defense Infrastructure.
Amazon has disputed Oracle's allegations of wrongdoing, saying
Mr. Ubhi recused himself from JEDI discussions inside the Pentagon.
Oracle says he didn't recuse himself until the procurement work was
in advanced stages. Mr. Ubhi couldn't be reached for comment on
Thursday.
Write to John D. McKinnon at john.mckinnon@wsj.com
(END) Dow Jones Newswires
April 12, 2019 02:47 ET (06:47 GMT)
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