Letter to Jeff Bezos, CEO of Amazon.com Inc. - Lee, Buck Question Amazon's Influence on JEDI Contract Procurement Process
Letter
Dear Mr. Bezos:
We are writing regarding potentially corrupt and anticompetitive conduct by Amazon Web Services, Inc. ("AWS") that may have violated federal conflict of interest and antitrust laws. Specifically, 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.
In 2013, the U.S. Intelligence Community awarded AWS a single award contract under the program called Commercial Cloud Services (C2S). On July 26, 2018, the Department of Defense ("DOD") issued Solicitation No. HQ0034-18-R-0077, which sought to award the largest government cloud contract in history to a single contractor. This procurement, known as the Joint Enterprise Defense Infrastructure ("JEDI") cloud procurement, is a single, potential 10 year, $10 billion Indefinite Delivery Indefinite Quantity contract to provide Infrastructure as a Service (IaaS) and Platform as a Service (PaaS) for DOD to support warfighter operations across the entire Department.
Despite Congress's clear preference for competition in Federal contracting, the JEDI program was awarded as a single contract, ultimately to Microsoft, but is currently under protest by Amazon. This pattern of large, long-term single awards presents serious concerns because of the potential to create monopolies for cloud services within the Federal government, deny taxpayers the benefits of price competition, and reduce innovation to support war fighting efforts.
Our concerns therefore go to the process under which JEDI was conceived, the reasons JEDI was originally contemplated as a non-competitive award utilizing the DOD's Other Transaction Authority ("OTA"), and the reasons JEDI was conceived as a single award, despite Congress's well-understood and clearly articulated preference for full and ongoing competition.
Please respond to the following questions by May 31, 2021. If you have any questions you may contact Sen. Lee's staff.
Amazon Public Sector Federal Cloud Business
1. Please provide the total value of all Amazon Web Services ("AWS") contracts with the U.S. Federal Government, including through AWS's subcontracts and other business arrangements with systems integrators and other prime contractors.1 Please also provide a list of all U.S. Federal agencies for which AWS itself or through systems integrators and other prime contractors provides cloud services. Please list all current contracts for AWS services, the date of the contracts, the contract term, the aggregate value, and the annual recurring revenue.
2. In responding above, please identify which, if any, awards were made as part of a competitive RFP and which were made using any form of sole source, OTA, single award, General Services Administration ("GSA") schedule, or Government-wide Acquisition Contract ("GWAC") contracting authority.
3. Please provide a list of all current Amazon Web Services employees hired directly from Federal agencies over the past five years, and please note which of those employees are currently working in roles related (directly or indirectly) to procuring services with their prior employer.
Origins of JEDI
On September 13, 2017, Deputy Secretary of Defense Patrick Shanahan issued a memorandum entitled "Accelerating Enterprise Cloud Adoption."2 This was the first time the acquisition of a DOD enterprise-wide cloud was made public and official. This memo is notable for its direction to utilize "a tailored acquisition process," as opposed to a competitive procurement.
4. Please provide or describe any communication anyone at Amazon had with Secretary of Defense James Mattis, Senior Advisor to Secretary Mattis Sally Donnelly, Chief of Staff to the Deputy Secretary of Defense Anthony DeMartino, Defense Digital Service Director Chris Lynch, or Defense Innovation Board Executive Director Josh Marcuse regarding the subject and contents of DSD Shanahan's memorandum prior to its release on September 13, 2017.
5. Please explain what you believe was meant by "tailored acquisition process" in DSD Shanahan's September 13 memorandum. Was it Amazon's understanding prior to, or commensurate with, the September 13, 2017 Memorandum that DOD's enterprise cloud was being considered as a single direct award, including potentially as an OTA?
6. At the time of the memorandum, did Amazon believe there was to be a Request for Proposals and a competitive evaluation or that the contract simply would be awarded to a single vendor? If you believed it was intended as a competition, please provide any support that would support that conclusion.
Amazon/Amazon Web Services Relationship with SBD Advisors and Sally Donnelly
It has been established by the Department of Defense Inspector General that Amazon retained
Washington D.C.-based SBD Advisors for consulting services.3 The Inspector General further established that SBD Advisors principal Sally Donnelly provided consulting services for Amazon prior to entering DOD as Senior Advisor to Secretary Mattis.4 It has been reported that Amazon remained a client of SBD Advisors until at least March 2018, spanning the entire tenure of Ms. Donnelly at DOD.5
7. Please describe any business or commercial relationship Amazon has ever had with SBD Advisors or Ms. Sally Donnelly.
8. Please describe SBD Advisors and/or Ms. Donnelly's work for Amazon regarding advocacy for Amazon cloud services with U.S. Government agencies, including the Department of Defense.
9. Please provide copies of all contracts, scopes of work, memoranda, strategy documents, presentations, emails, and text messages relating to SBD Advisors and/or Ms. Donnelly's work on behalf of Amazon with the Department of Defense.
10. Please provide the total amount paid by Amazon or any affiliate to Sally Donnelly or SBD Advisors. Please include a schedule of those payments including the dates and individual amounts.
11. Please describe all interactions between Ms. Donnelly6 and any Amazon employee, including but not limited to Jeff Bezos, Andy Jassy, Ariel Kelman, Teresa Carlson7, Max Peterson, Jennifer Chronis, Mark Ryland, Mary Camarata, and Jay Carney between January 20, 2017 and March 31, 2018. Please provide all relevant emails and text messages, including from personal email accounts.
Amazon/Amazon Web Services Relationship with SBD Advisors and Anthony DeMartino
Mr. Anthony DeMartino was also a principal in the firm SBD Advisors and provided consulting services to Amazon. In January 2017, Mr. DeMartino left SBD Advisors and joined the Department of Defense, eventually serving as Chief of Staff to the Deputy Secretary of Defense. It has been established by the DOD IG that Mr. DeMartino participated in the preparation and issuance of DSD Shanahan's September 2017 memorandum entitled "Accelerating Enterprise Cloud Adoption."8
12. Please describe DeMartino's consulting work for Amazon while at SBD Advisors regarding cloud services with U.S. Government agencies, including the Department of Defense.
13. Please describe all interactions between DeMartino and any Amazon employee, including but not limited to Jeff Bezos, Andy Jassy, Ariel Kelman, Teresa Carlson9, Max Peterson, Jennifer Chronis, Mark Ryland, Mary Camarata, and Jay Carney between January 20, 2017 and March 31, 2018. Please provide all relevant emails and text messages, including from private email accounts.
AWS Relationship with C5 and/or Andre Pienaar
C5 Capital Ltd., founded by Andre Pienaar, is a commercial partner of Amazon Web Services. In May 2017, AWS Vice President Teresa Carlson was quoted as saying: "We've been partnering with C5 around the world for a long time."10 C5 is also a known sponsor of many Amazon events including AWS re:Invent. At least until March 2018 Amazon Web Services also had a commercial relationship with SBD Advisors. 11 On March 8, 2020, AWS Vice President of Global Public Sector sales Teresa Carlson and Andre Pienaar were married in Washington, DC.
14. Please describe any business or commercial relationship Amazon has ever had with C5 and/or Andre Pienaar.
15. Please provide the total amount of payments or other forms of consideration paid by Amazon or any affiliate to: C5 or any of its affiliated companies; or Andre Pienaar or any of his affiliated companies. Please include any payments that may have been made as part of reseller or partner agreements.
16. Please document the time when Amazon became aware that Ms. Teresa Carlson and Mr. Andre Pienaar were involved personally and/or engaged to be married. Did Amazon put any procedures in place to separate Ms. Carlson from the AWS/C5 commercial relationship? Please provide all documentation and email correspondence relating to any firewall established between Ms. Carlson and C5.
17. Was Ms. Carlson responsible for monetary and/or in-kind consideration provided to C5/Andre Pienaar as part of the commercial relationship with Amazon? Did Andy Jassy, CEO of AWS or Jay Carney, Senior Vice President of Global Corporate Affairs, approve any contracts or financial remuneration between AWS and C5 or Andre Pienaar? If not, which Amazon employee did?
18. Please provide all contracts (including the signature page) between Amazon and C5, including its related entities.
Sale of SBD Advisors
In January 2017, Andre Pienaar acquired SBD Advisors from its principal, Sally Donnelly, upon
Ms. Donnelly joining DOD.12 According to the DOD IG, during the period January 2017 through March 2018, Mr. Pienaar (then 100 percent owner of SBD) made four progress payments in the
amount of $390,000 to Ms. Donnelly related to the sale of SBD Advisors for a total $1.56 million.13 As established above, Amazon was still a client of SBD Advisors throughout this period. Amazon was also a commercial partner of C5 throughout this period. Amazon's Teresa Carlson and C5's Andre Pienaar were engaged to be married during this timeframe.
19. Describe when Amazon first became aware that Donnelly intended to sell her firm and describe any discussions between any Amazon employee and any other person (including Andre Pienaar, Sally Donnelly, and Anthony DeMartino) regarding the sale of SBD Advisors. Please provide any communications regarding the sale of SBD Advisors in the possession of any Amazon employee.
20. Given that, at the time of the sale of SBS Advisors, Amazon had a commercial relationship with both C5/Andre Pienaar and SBD Advisors, please explain what steps Amazon took to ensure the appropriate controls were in place regarding communications with Ms. Donnelly upon her move to DOD.
21. What measures were taken to assess whether Ms. Carlson's relationship with Andre Pienaar, as the owner/director of C5 as well as the owner of SBD Advisors, complied with Amazon's Code of Business Conduct and Ethics or similar policies?
22. In 2018, a spokesman for SBD Advisors, Price Floyd, made statements to the press denying that the purchaser of SBD Advisors had any commercial relationship with Amazon Web Services and identifying the purchaser of SBD Advisors as a "group of investors led by Win Sheridan," without any reference to Andre Pienaar.14 Mr. Floyd stated: "None of these [investors] hold any interest in the defense sector, nor have any commercial relationship with Amazon Web Services."15 At the same time, Charlie Jack, a spokesman for C5 said: "Neither C5 Capital nor any of its venture capital funds or employees bought any shares from Sally Donnelly in January 2017 when she sold her
interest in the firm before commencing public service."16 According to the DOD IG, Ms. Donnelly sold the controlling interest of her firm to Mr. Pienaar, making these statements obviously and demonstrably untrue when they were made.17
a. Describe any communication between any Amazon employee and any other person regarding these statements to the press, either before or after they were made.
b. Please describe and provide all emails/documents relating to the first time Amazon understood that SBD Advisors was sold to Mr. Andre Pienaar, a commercial partner of Amazon.
c. Please describe any communications between Amazon and the public relations firm Hudson Sandler or any of its agents or representatives regarding C5 and/or SBD.
d. When did Amazon first become aware of this public statement denying any commercial relationship between the purchaser of SBD Advisors and AWS?
e. Why has Amazon not corrected this obvious misstatement?
23. It has been reported that Amazon continued to retain SBD Advisors following Donnelly's departure from SBD Advisors and the sale of SBD Advisors to Andre Pienaar.18 Please describe:
a. Any discussion with Donnelly (or any other person associated with SBD Advisors) before or after the sale of her firm regarding whether Amazon would continue to retain SBD Advisors, for what purpose, at what cost to Amazon, and for how long. Please also describe the involvement of Andre Pienaar in any such discussions.
b. For what reason did Amazon cease its commercial relationship with SBD Advisors in March 2018, the same month Donnelly resigned from DOD?
c. Was Amazon aware that, at the time it was paying SBD Advisors, SBD Advisors/Andre Pienaar was also making periodic progress payments to Ms. Donnelly in the amount of $390,000? Was Ms. Carlson aware of this fact?
d. Between the periods January 2017 and March 2018, who at SDB Advisors was providing services to Amazon? Please provide the names of any SBD Advisors personnel providing services, number and subject of any calls, meetings, or other interactions between Amazon and SBD Advisors during this time.
Relevant JEDI Meetings
24. On August 10, 2017, Secretary Mattis travelled to Amazon headquarters in Seattle and met with Jeff Bezos and other senior Amazon leaders.19
a. Please provide a list of attendees at that meeting and provide any contemporaneous notes that may have been taken by any Amazon employees in attendance.
b. After Secretary Mattis and Mr. Bezos departed that meeting, it has been reported that a number of Amazon and DOD employees continued the meeting. Please list which Amazon employees attended the follow-on meeting, and provide any contemporaneous notes or follow-on email communications.
c. Shortly after that meeting on August 10th, AWS DOD General Manager Jennifer Chronis submitted "options and potential cost estimates for a notional DOD move to the cloud" to Defense Innovation Board Executive Director Joshua Marcuse. Please provide all internal documents and communications associated with that proposal. Please also provide all internal documents and communications memorializing Ms. Chronis's September 1, 2017 conversation with Mr. Marcuse referred to by Ms. Chronis in her September 6, 2017 e-mail.
d. Was the DOD "move to the cloud" in the Marcuse correspondence discussed at the meeting between Bezos and Mattis at Amazon headquarters in August 2017 or any follow-on meeting?
25. In March 2017 Teresa Carlson attended a private dinner with Secretary Mattis, Ms. Donnelly, Mr. Pienaar, and others in London held at 5 Hertford Street, one of London's most exclusive clubs.20
a. Name every person at Amazon or the DOD with whom any Amazon employee discussed Carlson's attendance at this dinner before it occurred.
b. Provide all documents, including emails, regarding the goals of that meeting, talking points, or preparatory memoranda.
c. Describe in detail any ethical review of Carlson's attendance at this dinner, including as it related to Amazon obligations under the Federal Acquisition Regulations or any person's obligation under federal ethics requirements and limitations.
d. Given Ms. Donnelly's attendance at that dinner, please detail any legal guidance provided by Amazon to Ms. Carlson regarding her communications with Ms. Donnelly.
26. On January 4, 2018, DSD Shanahan issued a second cloud memorandum entitled "Accelerating Enterprise Cloud Adoption Update," which modified the September 2017 memorandum and changed the term "tailored acquisition process" to "full and open competition." Two weeks later, on January 17, 2018, Teresa Carlson and Jeff Bezos attended a private four-person dinner with Secretary Mattis and Senior Advisor Donnelly at DBGB restaurant in Washington DC.21
a. Describe in detail the arrangements for this dinner, including any communications between Amazon and Secretary Mattis' office, Donnelly, or any other DOD personnel.
b. Please provide any notes or summary of the meeting memorialized by Ms. Carlson, Mr. Bezos, or anyone else at Amazon.
c. Please provide any follow-up correspondence (email and otherwise), including thank-you notes, between any Amazon employee and any DOD employee.
d. Describe in detail any ethical review of Carlson's or Bezos's attendance at this dinner, including Amazon's obligations under the Federal Acquisition Regulations or any person's obligation under federal ethics requirements and limitations.
Communications with the DOD Cloud Executive Steering Group, Office of the Secretary of Defense and the Defense Digital Service
27. Please provide all communication between any Amazon employee and any member of the DOD Cloud Executive Steering Group ("CESG") between September 13, 2017 and November 1, 2019, including any memorandum, draft documents, redlined documents, suggested/recommended gate criteria, talking points, or comments, relating to the work of the Cloud Executive Steering Group.
28. Please provide all communication between any Amazon employee and any member of the Office of the Secretary of Defense ("OSD") between September 13, 2017 and November 1, 2019, including any memorandum, draft documents, redlined documents, suggested/recommended gate criteria, talking points, or comments, relating to the work of the OSD.
29. Please provide all communications between any Amazon employee and any member of the DOD Defense Digital Service between September 13, 2016 and November 1, 2019, including any memorandum, draft documents, redlined documents, suggested/recommended gate criteria, talking points, or comments, relating to the work of the Defense Digital Service.
Pallas Advisors
Pallas Advisors is a Washington DC-based consulting firm established by Sally Donnelly and Anthony DeMartino in July 2018 after they departed DOD.22
30. Please provide all communications between any Amazon employee and Ms. Sally Donnelly and/or Anthony DeMartino regarding the creation/establishment of Pallas Advisors.
31. Mr. Robert Daigle was a member of the DOD Cloud Executive Steering Group and is now a Principal with the firm Pallas Advisors.23 Please describe and provide any communication between Amazon and Mr. Daigle either during his service with the DOD or since his departure.
32. Dr. Will Roper was a member of the DOD Cloud Executive Steering Group and is now a Senior Counselor with the firm Pallas Advisors.24 Please describe and provide any communication between Amazon and Dr. Roper either during his service with the DOD or since his departure.
33. Ms. Essye Miller was a member of the DOD Cloud Executive Steering Committee and is now a Principal with the firm Pallas Advisors.25 Please describe and provide any communication between Amazon and Ms. Miller either during her service with the DOD or since her departure.
34. Lieutenant General (Retired) Tony Ierardi was previously the Joint Staff's J-8 Director where he played a significant role in the JEDI procurement, including as the Secretary of the Joint Requirements Oversight Council ("JROC"). He is now a Principal at Pallas Advisors.26 Please provide all communications between any Amazon employee and Mr. Ierardi either during his time on active duty or since.
35. Please describe all commercial/financial relationships between Amazon and Pallas Advisors or its related entities and/or funds.
Thank you for your prompt attention to these questions and concerns. We look forward to receiving and reviewing your responses.
Sincerely,
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