WASHINGTON (CN) — A Defense Department watchdog said Wednesday the Pentagon did not violate laws or regulations when awarding a $10 billion cloud computing contract to Microsoft, though an executive privilege claim prevented it from fully reviewing whether the White House steered the contract away from Amazon due to President Donald Trump's personal animus against the tech giant.
The Defense Department inspector general’s 211-page report found the Pentagon followed applicable regulations and federal law in the process of awarding the Joint Enterprise Defense Infrastructure (JEDI) cloud computing contract. The report also states the evidence shows career Pentagon employees who evaluated and awarded the contract did not feel pressure from senior agency officials or anyone at the White House when doing so.
Most of the career officials who made key decisions about the contract were not known to the White House and testified that even Trump's public comments and media reports did not "directly or indirectly influence the integrity of the procurement process or the outcome of the JEDI Cloud source selection," according to the report.
Furthermore, former Secretary of Defense James Mattis and other senior Defense Department officials the inspector general's office interviewed said they did not recall talking with Trump about the contract, Amazon, or its CEO Jeff Bezos.
"In sum, while our review was limited by invocation of a 'presidential communications privilege,' we did not find evidence to conclude that the DoD personnel who made the source selection for the JEDI contract were influenced or pressured to select or not to select a particular competitor for the contract," the report states.
Still, the inspector general found Trump's public comments and media reporting on the contract might not have given such an impression to the public.
"Yet these media reports and the reports of President Trump's statements about Amazon, ongoing big protests and 'lobbying' by JEDI Cloud competitors, as well as inaccurate media reports about the JEDI Cloud procurement process, may have created the appearance or perception that the contract award process was not fair or unbiased," the report states.
In addition, investigators declined to question multiple Defense Department witnesses after the White House Counsel's Office insisted it would only allow the witnesses to respond in writing to questions that touched on conversations with Trump or administration officials.
Investigators declined to go down that path, saying it would delay the report, prevent follow-up questions and "not assure that we would be receiving full information from the witnesses." The inspector general’s office did, however, review official presentations and documents as part of its investigation
The Pentagon in October awarded the JEDI cloud computing contract to Microsoft, turning down bids from companies including Amazon Web Services. Amazon then filed suit in the Court of Federal Claims alleging that the lucrative contract went to Microsoft under pressure from the White House.
Amazon claims Trump's public war with Bezos over what the president perceives as unfair coverage in the Washington Post, which Bezos also owns, caused the White House to step in and prevent Amazon from winning the bid. Trump put a hold on the contract in August after earlier allegations of conflicts of interest that biased Pentagon contracting officials in favor of Amazon and Microsoft.
As detailed in the report, a former staffer for Defense Secretary Mattis wrote in a book that Trump told Mattis to "screw Amazon" out of the contract. Mattis told investigators that the staffer's book "is full of inaccuracies" and investigators could not verify the book's claims.
The court in February issued a preliminary injunction temporarily blocking the Pentagon from going forward with the contract, though the report says that decision, which focused on one specific portion of Microsoft's proposal, does not conflict with the inspector general's broader findings.
The report's findings did not determine whether Microsoft was the right recipient of the contract, but instead whether the process that preceded that decision was appropriate.
A Department of Defense official said the report should be the last word on "corporate-driven attacks" on contracting officials who made the procurement decisions.
"The inspector general's 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 official said. "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."
In a statement, Microsoft spokesperson Frank Shaw accused Amazon of trying to get a "do-over" on the contract after submitting too high of an initial bid.
"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," Shaw said.
A spokesperson for Amazon Web Services said the report is incomplete, pointing to the scope of the inspector general's review and the inability of investigators to interview certain witnesses.
"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," the spokesperson said in a statement.
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