JEDI protest paused over conflict-of-interest questions

Conflict-of-interest allegations have temporarily paused Oracle's lawsuit against the Pentagon seeking to stop its $10 billion cloud buy.

In response to a motion from the Defense Department,   Judge Eric Bruggink of the Court of Federal Claims issued a stay Feb. 19 while DOD considers "whether possible personal conflicts of interest impacted the integrity of the JEDI Cloud procurement."

The DOD's motion seeking the stay remains under seal.

The conflict-of-interest allegations stem from the participation of two individuals in the Joint Enterprise Defense Infrastructure procurement with strong ties to Amazon Web Services, the vendor widely seen as having the inside track in this procurement because of its work provisioning classified cloud services for the intelligence community.

In a Feb. 12 filing seeking a judgment in the case, Oracle argued in part that the procurement was tainted by the involvement of Deap Ubhi, a member of the Defense Digital Services team, and Anthony DeMartino, who served as chief of staff to then-Deputy Secretary of Defense Patrick Shanahan, who launched the JEDI procurement.

Ubhi worked at AWS before joining DOD for a stint of a little more than a year, where he worked on the JEDI procurement. Ubhi then returned to Amazon. According to Oracle's filing, the contracting officer on JEDI did not sufficiently probe potential conflicts of interest. Oracle also argued that Ubhi was a strong advocate for the single-award approach in the procurement -- a position that Oracle argued is not supported by procurement law.

DeMartino was a consultant to Amazon before joining DOD as deputy chief of staff in the Office of the Secretary of Defense. In March 2017, DeMartino became Shanahan's chief of staff. According to Oracle's filing, DeMartino was advised by the Standards of Conduct Office not to participate in the JEDI program.

In the Feb. 12 filing, Oracle indicated it did not "object to a stay of this particular allegation" pending the completion of the ongoing conflict-of-interest probes.

In his order, Judge Bruggink directed DOD to file a status report within five days of a determination in the conflict investigation.

Oracle's lawsuit is not limited to the allegations of conflict of interest. The company alleged that the Pentagon ignored the intent of Congress in establishing JEDI as a single-award indefinite delivery indefinite quantity contract.

"JEDI is a classic IDIQ technology contract of the very type that led Congress to enact provisions favoring task order competition," Oracle argued in its motion for judgment.

Additionally, Oracle asserted that the Pentagon's claims of more than $500 million in increased overhead and multiple years of delay as a result of moving JEDI to a multiple-award vehicle were concocted by contracting officers essentially out of thin air. Oracle also argued that certain requirements, involving security certification and data center locations, were established to knock most potential competitors out of the running.

This article was first posted to FCW, a sibling site to Defense Systems.