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Defense Secretary Mark Esper Recuses Himself From JEDI Cloud Contract Review

Jeff Brody
Mark Esper

Defense Secretary and 2019 Wash100 awardee Mark Esper has recused himself from a review of the Pentagon’s potential 10-year, $10B Joint Enterprise Defense Infrastructure cloud computing contract to avoid any issue of a conflict of interest.

Jonathan Rath Hoffman, a spokesperson for the Defense Department, said in a statement published Tuesday Esper has withdrawn himself from taking part in any decision making because of his son’s employment with one of the first bidders.

A spokesperson for IBM (NYSE: IBM) said Esper’s son has been working since February at IBM’s services business as a digital strategy consultant and his position is not associated with the firm’s pursuit of the single-award cloud contract, according to a report by the Wall Street Journal.

Microsoft (Nasdaq: MSFT) and Amazon (Nasdaq: AMZN) emerged as final competitors for the JEDI contract in April after DoD ruled out bids from IBM and Oracle (NYSE: ORCL).

Hoffman said Esper has assigned David Norquist, deputy defense secretary and fellow Wash100 winner, to oversee the decision-making process for the JEDI cloud contract "out of an abundance of caution to avoid any concerns regarding his impartiality."

In August, the Pentagon’s office of inspector general formed a team of auditors to review the department’s handling of the JEDI cloud acquisition effort.

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