GOP Lawmakers Urge Probe of Amazon's Pursuit of Pentagon Contract
By Dana Mattioli
Two Republican lawmakers are pressing the attorney general to
investigate potential anticompetitive behavior by Amazon.com Inc.
in its pursuit of a major government cloud-computing contract,
according to letters reviewed by The Wall Street Journal.
Sen. Mike Lee (R., Utah) and Rep. Ken Buck (R., Colo.) urged
Attorney General Merrick Garland to open up an investigation into
the Joint Enterprise Defense Infrastructure procurement process in
a joint letter on Monday evening. Amazon was one of a number of
technology companies that competed for the Department of Defense's
10-year, $10 billion cloud-computing contract, but ultimately lost
to rival Microsoft Corp.
The letter says Amazon might have violated antitrust laws and
federal conflict-of-interest laws. "We are concerned that Amazon
may have attempted to monopolize one or more markets relating to
government and/or commercial cloud computing services by improperly
influencing the Joint Enterprise Defense Infrastructure procurement
process," the letter says.
Amazon didn't immediately respond to requests for comment late
Monday. The company previously has said its cloud subsidiary
received no preferential treatment.
Amazon has contested the 2019 decision awarding the so-called
JEDI contract to Microsoft, its largest cloud-computing rival.
Amazon contends that it was treated unfairly in the JEDI
procurement process, claiming that former President Donald Trump
improperly influenced the outcome and steered the contract to
another bidder. The Pentagon has denied those claims.
Last week, Amazon won a procedural victory in that fight when a
federal judge rejected motions by the Defense Department and
Microsoft to dismiss much of its challenge of the contract
Amazon Web Services is the largest cloud-computing company in
the world, and the main profit driver for its parent company. In
the U.S., Amazon's cloud-computing arm commands 64.5% of the
market, according to research firm Gartner.
In their letter to Mr. Garland, Messrs. Lee and Buck point to
what they say are undisclosed payments between an Amazon consultant
and a Department of Defense official. In another alleged conflict
of interest, Messrs. Lee and Buck describe a different Department
of Defense official who had previously worked as a consultant for
Amazon "playing an integral role in drafting directives regarding
the Department's cloud acquisition strategy" despite being
instructed to recuse himself from matters regarding Amazon.
A separate letter from Messrs. Lee and Buck addressed to Amazon
Chief Executive Jeff Bezos requests all communications between
Amazon and former Secretary of Defense Jim Mattis, as well as the
Department of Defense officials they allege had conflicts of
Representatives for the Department of Defense and Mr. Mattis
didn't immediately respond to requests for comment late Monday.
Amazon rival Oracle Corp., before the JEDI contract was awarded,
publicly raised concerns over contacts between Amazon and Mr.
Mattis and other Defense Department officials. Amazon at the time
said it had "received no preferential treatment in any procurement
as a result of any meetings" with Defense Department officials. The
Pentagon said at the time the JEDI bidding process was "open,
transparent and full."
Amazon is the subject of intense antitrust scrutiny from
Congress and regulatory agencies both in the U.S. and abroad. Most
probes have focused on Amazon's retail side of the business, and
its treatment of third-party sellers and how Amazon uses the vast
amounts of data it collects. Last year, a congressional committee
exploring the power of Amazon, Apple Inc., Facebook Inc. and
Alphabet Inc.'s Google determined that Amazon has "monopoly power"
over sellers on its platform.
--John D. McKinnon contributed to this article.
(END) Dow Jones Newswires
May 04, 2021 00:03 ET (04:03 GMT)
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