ALLEGATIONS IN ORACLE LAW SUIT SERVE IMPORTANT REMINDER ON CONFLICTS
While it is rare that people who misbehave in the world of government procurement can go to jail, it does happen. Recent allegations made in Oracle’s lawsuit over DOD’s JEDI procurement could, if found to be true, result in one or more prison sentences, the jeopardization of a major contract award for Amazon Web Services, and the end of careers for people in both the company and DOD. If most of this sounds familiar, it’s because it’s happened before. Former DOD acquisition chief Darleen Druyun went to prison for her failure to recuse herself from an active procurement that she was a part of while discussing employment with Boeing, a potential winner of the procurement, at the same time. The Oracle suit alleges much the same thing. Two DOD officials that were part of the JEDI procurement are alleged to have had employment discussions with Amazon Web Services during the conduct of the same procurement. At least one went to work for the company. If the facts essentially follow the Druyun precedent, this could be very bad news, not only for the people involved, but for AWS. Druyun served 9 months in federal prison. At least two Boeing executives were fired. Boeing paid a multi-million dollar fine. Many suspect that they only reason that Boeing didn’t end up on the Excluded Parties List is that DOD relies too much on the company. That’s not the case for AWS, or, indeed, most other contractors. There is a lesson here for all contractors though: Don’t recruit people to come work for you that are involved in a current acquisition on which you are bidding. Federal rules allow for discussions in some cases, such as when the government official recuses him or herself from the project. Absent that, treat this issue as a third rail – do not touch.