The Insider

By John Liang
January 8, 2021 at 2:11 PM

This Friday INSIDER Daily Digest has news on a Space Development Agency satellite tracking program, the Army's counter-small unmanned aircraft system strategy and more.

A Space Development Agency spokeswoman has confirmed to Inside Defense that work on the Tracking Layer Tranche 0 satellite development contracts has resumed:

SDA lifts stop-work order on tracking layer satellites, sticks with SpaceX, L3Harris

SpaceX and L3Harris have resumed work on the Space Development Agency's Tracking Layer Tranche 0 satellite development contracts after a series of protests put the companies' contracts on hold and led the agency to reevaluate bids.

The Army has released its counter-small unmanned aircraft system strategy:

Army releases C-sUAS strategy

The Army today released the recently approved, counter-small unmanned aircraft system strategy to direct the Defense Department's C-sUAS activities in a variety of operating environments.

Document: Army's C-sUAS strategy

Inside Defense recently interviewed Air Force Chief Software Officer Nicolas Chaillan about the recent SolarWinds cyberattack:

USAF ramping up software cybersecurity defenses after SolarWinds breach

Air Force Chief Software Officer Nicolas Chaillan has demanded a heightened defense posture following the recent massive SolarWinds breach and warns the service is bound to be a major target for cyberattacks in the years ahead.

The spillover of major power competition into the Arctic, in increasingly navigable waterways caused by melting ice caps, has the potential to threaten U.S. interests, according to a new Navy report:

Arctic presence needed to counter Russia and China, new naval strategy says

The Navy needs to increase its presence in the Arctic as Russia and China will seek to assert power in the region, according to the Navy's new Arctic strategy, released Tuesday.

Document: Navy's Arctic strategy

The Defense Department has issued a new cybersecurity policy:

New DOD policy reinforces 'foundational' role of cybersecurity in acquisitions

A new Defense Department instruction makes official a concept DOD officials have been increasingly beating the drum over the past several years: cybersecurity is critical to all aspects of defense acquisitions.

Document: DOD instruction on cybersecurity for acquisition decision authorities and PMs

By Marjorie Censer
January 7, 2021 at 5:15 PM

As part of a new settlement with the Justice Department over the 737 MAX program, Boeing has agreed to cooperate with the department's fraud section in any ongoing or future investigations, according to DOJ.

In an announcement today, the Justice Department said Boeing has agreed to pay more than $2.5 billion to resolve a criminal charge "related to a conspiracy to defraud the Federal Aviation Administration's Aircraft Evaluation Group . . . in connection with the FAA AEG's evaluation of Boeing's 737 MAX airplane."

Additionally, under the terms of the settlement, "Boeing is required to report any evidence or allegation of a violation of U.S. fraud laws committed by Boeing's employees or agents upon any domestic or foreign government agency (including the FAA), regulator, or any of Boeing's airline customers," DOJ added.

"In addition, Boeing has agreed to strengthen its compliance program and to enhanced compliance program reporting requirements, which require Boeing to meet with the Fraud Section at least quarterly and to submit yearly reports to the Fraud Section regarding the status of its remediation efforts, the results of its testing of its compliance program, and its proposals to ensure that its compliance program is reasonably designed, implemented, and enforced so that it is effective at deterring and detecting violations of U.S. fraud laws in connection with interactions with any domestic or foreign government agency (including the FAA), regulator, or any of its airline customers," the Justice Department said.

According to DOJ, the more-than-$2.5 billion payment is composed of a criminal monetary penalty of nearly $244 million, compensation payments to airline customers of $1.8 billion and the creation of a $500 million crash-victim beneficiaries fund for the relatives of the 346 passengers who died in the two Boeing 737 MAX crashes.

Lion Air Flight 610 crashed in late 2018 and Ethiopian Airlines Flight 302 crashed in early 2019.

In a statement today, Boeing notes that as part of the resolution, the Justice Department has agreed to defer prosecution of the company, providing Boeing abides by the obligations in the three-year deferred prosecution agreement. At that point, the company adds, the charge will be dismissed.

"The agreement is based on the conduct of two former Boeing employees and their intentional failure to inform the FAA Aircraft Evaluation Group (AEG), the group within the FAA responsible for making pilot training determinations, about changes to the Maneuvering Characteristics Augmentation System," Boeing said.

David Calhoun, Boeing's chief executive, said in a note to employees that entering into the resolution is "the right thing for us to do."

"This resolution is a serious reminder to all of us of how critical our obligation of transparency to regulators is, and the consequences that our company can face if any one of us falls short of those expectations," he added.

Boeing noted the company has taken a $744 million charge to earnings in connection with the agreement.

By Jason Sherman
January 7, 2021 at 4:54 PM

Inside Defense has retracted a story published Jan. 6 that incorrectly reported a three-month delay in the Regional Glide Phase Weapon program.

The mistake stemmed from misinterpreting a recent public posting by the Missile Defense Agency.

MDA, which had aimed to publish a solicitation to launch the new hypersonic defense program last month, is -- however -- behind schedule with the RGPW effort. The schedule slip is only a couple of weeks, according to an agency official, who added the request for prototype proposals should be ready for industry no later than the end of this month. Inside Defense regrets the error.

By Tony Bertuca
January 7, 2021 at 4:27 PM

The Senate Armed Services Committee said today it will hold a hearing Jan. 19 to consider the nomination of retired Army Gen. Lloyd Austin to serve as President-elect Biden's defense secretary.

Austin must be confirmed by the full Senate, but he also requires a congressional waiver because he has been retired from the military for fewer than eight years. The waiver was approved for retired Marine Corps Gen. Jim Mattis to become defense secretary in 2017, the first time in nearly 70 years.

If confirmed, Austin would be the nation's first black defense secretary.

Since retiring from the military in 2016, Austin has been a board member at Raytheon Technologies and several other companies.

His nomination has sparked concern about civilian control of the U.S. military. The committee intends to hold a Jan. 12 hearing with outside experts to discuss civilian control of the military and potential issues posed by Austin's nomination. A similar hearing was held related to Mattis' nomination.

Austin, meanwhile, has pledged to run the Defense Department as a civilian, not a general.

"I come to this role now as a civilian leader -- with military experience to be sure -- but also with a deep appreciation and reverence for the prevailing wisdom of civilian control of our military," he said in December.

By Tony Bertuca
January 7, 2021 at 3:51 PM

Acting Defense Secretary Chris Miller today condemned the violence of a pro-Trump mob that invaded the Capitol yesterday and pledged the Pentagon's full cooperation in a peaceful transition of power to President-elect Biden.

"I strongly condemn these acts of violence against our democracy," Miller said. "I, and the people I lead in the Department of Defense, continue to perform our duties in accordance with our oath of office, and will execute the time-honored peaceful transition of power to President-elect Biden on January 20."

The Biden transition team, however, has criticized the Pentagon for failing to provide timely briefings. Miller has disputed this.

"Yesterday's violence at the Capitol was reprehensible and contrary to the tenets of the United States Constitution," Miller said today. "Our Republic may have been disrupted yesterday, but the resolve of our legislators to conduct the people's business did not waver. Due to their efforts, supported by local and federal law enforcement and the National Guard, the attempts of those who tried to stop our government from functioning failed."

Meanwhile, scores of lawmakers have called for Trump's removal, asserting he incited the mob.

Trump later tweeted a video in which he continued to repeat his baseless claim the election was "stolen” and called the mob "very special," but asked them to disperse. The video has been removed from Twitter and the president's account has been suspended. Trump has also been indefinitely banned from Facebook.

By Marjorie Censer
January 7, 2021 at 3:48 PM

VTG said today it has named longtime contracting executive Kirk Herdman to the newly created role of president for national security solutions.

"Herdman will lead VTG's market expansion strategy focused on delivering innovative technologies and digital solutions to a growing portfolio of national security customers within both the Defense enterprise and the Intelligence Community," the company said.

He previously was executive vice president for business development and corporate development at KeyW, which was sold to Jacobs in 2019. He has also been an executive at Sotera Defense Solutions, Wyle, General Dynamics, ManTech International and Veridian.

By John Liang
January 7, 2021 at 1:56 PM

This Thursday INSIDER Daily Digest has news on a new Navy Arctic strategy and more.

The spillover of major power competition into the Arctic, in increasingly navigable waterways caused by melting ice caps, has the potential to threaten U.S. interests, according to a new Navy report:

Arctic presence needed to counter Russia and China, new naval strategy says

The Navy needs to increase its presence in the arctic as Russia and China will seek to assert power in the region, according to the Navy's new Arctic strategy, released Tuesday.

Document: Navy's Arctic strategy

The Defense Department has issued a new cybersecurity policy:

New DOD policy reinforces 'foundational' role of cybersecurity in acquisitions

A new Defense Department instruction makes official a concept DOD officials have been increasingly beating the drum over the past several years: cybersecurity is critical to all aspects of defense acquisitions.

Document: DOD instruction on cybersecurity for acquisition decision authorities and PMs

A Democratic majority in the Senate -- albeit by the slimmest of margins -- means committee chairmanships are now in play:

Committee chairs ready to flip as Dems near sweep

Committee chairmanships are on the line as the results of two run-off Senate elections in Georgia indicate the Democratic party is close to claiming a majority in Congress that will be led by President-elect Biden from the White House.

U.S. Strategic Command chief Adm. Chas Richard spoke with reporters this week in a call organized by the Defense Writers Group:

STRATCOM boss swats at suggestion to extend Minuteman III service life

The head of U.S. Strategic Command moved to bat down suggestions that the Minuteman III -- the Air Force's aging intercontinental ballistic missile -- can be upgraded to remain in service longer than currently planned in order to free up funds the Pentagon wants to allocate to a replacement: the estimated $85 billion Ground Based Strategic Deterrent program.

By Tony Bertuca
January 7, 2021 at 11:51 AM

House Armed Services Committee Chairman Adam Smith (D-WA) joined scores of Democrats, at least one Republican and a major business association to call for the removal of President Trump today following a violent siege on the U.S. Capitol led by the president's supporters.

"President Trump incited & encouraged this riot," Smith tweeted. "He & his enablers are responsible for the despicable attack at the Capitol."

Smith said Vice President Pence and the presidential cabinet should invoke the 25th amendment to remove Trump, "otherwise Senate Republicans must work with the House to impeach & remove him."

While Smith was one of more than 100 Democrats who called for Trump's removal in the waning days of his presidency, there was at least one Republican who publicly joined them.

Rep. Adam Kinzinger (R-IL) tweeted a video message also calling for Trump's removal from office.

"The president caused this. The president is unfit. The president is unwell," he said.

The National Association of Manufacturers has also called for Trump's removal.

"The outgoing president incited violence in an attempt to retain power, and any elected leader defending him is violating their oath to the Constitution and rejecting democracy in favor of anarchy," according to a statement from President and CEO Jay Timmons. "Anyone indulging conspiracy theories to raise campaign dollars is complicit. Vice President Pence, who was evacuated from the Capitol, should seriously consider working with the Cabinet to invoke the 25th Amendment to preserve democracy."

Senate Minority Leader Chuck Schumer (D-NY) has also called for Trump’s removal.

“This president must not hold office one day longer,” Schumer tweeted. “The quickest and most effective way—it can be done today—to remove this president from office would be for the Vice President to immediately invoke the 25th amendment. If the Vice President and the Cabinet refuse to stand up, Congress must reconvene to impeach President Trump.”

House Speaker Nancy Pelosi (D-CA) said the House would consider impeachment if Trump was not removed via the 25th amendment.

"If the vice president and the cabinet do not act, the Congress may be prepared to move forward with impeachment," she said.

The House voted to impeach Trump once already in December 2019. He was not convicted in the Senate, however.

Meanwhile, President-elect Biden is scheduled to be inaugurated Jan. 20 and Democrats, who already have a majority in the House, are now projected to also have a majority in the Senate.

By Marjorie Censer
January 7, 2021 at 8:52 AM

Axiologic Solutions said today it has acquired Herndon, VA-based intelligence services company Knowledge Link, nearly doubling the size of the company.

In an interview with Inside Defense, Axiologic executives said the deal will expand the company's work with intelligence agencies. They did not disclose the price.

Michael Chavira, a managing partner at Axiologic, said Knowledge Link will initially operate as a wholly owned subsidiary.

"We don't want to disrupt what they are doing for" the National Geospatial-Intelligence Agency, he said. "Moving forward, we will slowly start integrating some of their processes and some of their infrastructure."

He said Knowledge Link has about 100 employees, bringing Axiologic's total to roughly 250.

The acquisition marks Axiologic's first, but executives said they are hoping to do one or two more later this year.

By Tony Bertuca
January 6, 2021 at 4:26 PM

The D.C. National Guard has been mobilized to provide support to law enforcement clashing with a pro-Trump mob that has stormed the Capitol.

Jonathan Hoffman, chief Pentagon spokesman, said acting Defense Secretary Chris Miller has been in contact with congressional leaders, all of whom were rushed out of the Capitol after rioters breached the building.

Multiple news outlets have confirmed that a woman was shot in the chest and is in critical condition. There were also reports that law enforcement officers were injured.

Virginia and Maryland have also deployed state and local law enforcement officers.

The attack on the Capitol happened after President Trump hosted a rally urging his supporters to oppose the certification of the presidential election, which he lost.

During a speech, Trump called on his supporters to "take back our country" and march to the Capitol.

"We're going to walk down to the Capitol," he said. "And we're gonna cheer on our brave senators and congressmen and women. And we're probably not going to be cheering, so much for some of them, because you'll never take back our country with weakness, you have to show strength and you have to be strong."

After the mob breached the Capitol, Trump tweeted asking "everyone at the U.S. Capitol to remain peaceful."

President-elect Biden said today the "words of a president matter."

"At their best, the words of a president can inspire," he said. "At their worst, they can incite. Therefore, I call on President Trump to go on national television now to fulfill his oath and defend the Constitution and demand an end to this siege."

By John Liang
January 6, 2021 at 2:20 PM

This Wednesday INSIDER Daily Digest has coverage of a new Pentagon cybersecurity policy, the implications of a Democratic majority on Senate defense committee chairmanships and more.

The Pentagon has issued a new cybersecurity policy:

New DOD policy reinforces 'foundational' role of cybersecurity in acquisitions

A new Defense Department instruction makes official a concept DOD officials have been increasingly beating the drum over the past several years: cybersecurity is critical to all aspects of defense acquisitions.

Document: DOD instruction on cybersecurity for acquisition decision authorities and PMs

The possibility of a Democratic majority in the Senate means committee chairmanships are now in play:

Committee chairs ready to flip as Dems near sweep

Committee chairmanships are on the line as the results of two run-off Senate elections in Georgia indicate the Democratic party is close to claiming a majority in Congress that will be led by President-elect Biden from the White House.

U.S. Strategic Command chief Adm. Chas Richard spoke with reporters this week in a call organized by the Defense Writers Group:

STRATCOM boss swats at suggestion to extend Minuteman III service life

The head of U.S. Strategic Command moved to bat down suggestions that the Minuteman III -- the Air Force's aging intercontinental ballistic missile -- can be upgraded to remain in service longer than currently planned in order to free up funds the Pentagon wants to allocate to a replacement: the estimated $85 billion Ground Based Strategic Deterrent program.

The Space and Missile Systems Center is delaying its formal selection of the National Security Technology Accelerator as the manager for the Space Enterprise Consortium following a Nov. 24 ruling against the company by a district court judge:

SMC eyes SpEC solicitation delays amid review of incoming consortium manager NSTXL

The Space and Missile Systems Center anticipates delays to new Space Enterprise Consortium solicitations as the Space Force continues its review of the incoming consortium manager, the National Security Technology Accelerator, in light of a recent Texas court decision involving the company.

Booz Allen Hamilton, IBM and Spin Systems have received Navy information warfare contracts:

Navy awards three Information Warfare Research Project prototype production contracts

The Navy has awarded contracts to three companies for Information Warfare Research Project prototype production.

By Ethan Sterenfeld
January 6, 2021 at 11:53 AM

The final Trophy active protection system ordered for the Abrams main battle tank has been delivered to the Army, Leonardo DRS announced Jan. 6.

Leonardo partnered with Rafael, the Israeli company that designed the Trophy system, to upgrade the combat protection of the Army and Marine Corps' Abrams tanks.

"While COVID created challenges for on-time deliveries, we used our resources and capabilities to facilitate on-schedule deliveries," Michael Lurie, a Rafael vice president, said in a press release. "With our partner Leonardo DRS, we remain committed to supporting the Army and providing increased protection to U.S. forces on a timely basis."

The Trophy system shoots down incoming rockets and missiles, and it can locate the source of hostile fire, according to the press release. It has successfully worked in combat on the Israeli Merkava main battle tank and Namer armored personnel carrier.

"Under contracts awarded on an urgent-need basis by the Army's Program Executive Office for Ground Combat Systems, the companies delivered the first APS systems in September 2019 for both the U.S. Army and Marine Corps," the press release stated.

The Army placed its first order for the Trophy active protection system in 2017, with a follow-up order coming in January 2019.

The service has also purchased the Iron Fist active protection system, from Israel Military Industries, for the Bradley Fighting Vehicle, and it has tested systems from Rheinmetall and Rafael for the Stryker combat vehicle.

By Courtney Albon
January 6, 2021 at 11:06 AM

The Pentagon has awarded Lockheed Martin a $1.28 billion undefinitized contract action to support F-35 operations and sustainment through June 30 as negotiations continue for a long-term performance-based logistics contract.

The company announced the UCA in a press release today.

“The UCA funds industry sustainment engineering across the globe,” the release says. “It also covers fleet-wide data analytics and supply chain management for part repair and replenishment to enhance overall supply availability.”

Meanwhile, the Pentagon and Lockheed continue to negotiate the terms of a possible five-year PBL contract that could pave the way for a future multiyear sustainment deal. Lockheed pitched the PBL deal in 2019 and projects the fixed-price contract could save the program $1 billion.

By Marjorie Censer
January 6, 2021 at 10:41 AM

Government contracting law firm Nichols Liu said today it has named Alan Chvotkin a partner and president of industry publisher Pub K, effective immediately.

Chvotkin will launch government relations and business intelligence practices for Nichols Liu, which was founded in 2017.

He previously was executive vice president and counsel of the Professional Services Council, an industry group.

By Justin Doubleday
January 5, 2021 at 4:54 PM

U.S. investigators confirmed today that they believe Russia is likely behind the SolarWinds cyber hack into multiple federal government agency and private networks revealed last month, though the operation appears to be limited to intelligence gathering.

In a joint statement released today, the National Security Council's "Cyber Unified Coordination Group" updated what it says is a continuing investigation into the SolarWinds software compromise uncovered last month, but likely extending back to spring of last year. The group is composed of the FBI, the Cybersecurity and Infrastructure Security Agency, the Office of the Director of National Intelligence and the National Security Agency.

"This work indicates that an Advanced Persistent Threat (APT) actor, likely Russian in origin, is responsible for most or all of the recently discovered, ongoing cyber compromises of both government and non-governmental networks," the group said. "At this time, we believe this was, and continues to be, an intelligence gathering effort. We are taking all necessary steps to understand the full scope of this campaign and respond accordingly."

The group said the statement was delivered "on behalf of President Trump." However, Trump has downplayed the Russian attribution and suggested that China may actually be behind the attack, connecting the incident to his baseless claims of widespread voter fraud in the 2020 election.

The compromised SolarWinds update was pushed to approximately 18,000 customers. However, U.S. intelligence agencies believe "a much smaller number have been compromised by follow-on activity on their systems," according to today's statement.

"We have so far identified fewer than ten U.S. government agencies that fall into this category, and are working to identify and notify the nongovernment entities who also may be impacted," the statement continues.

The Treasury and Commerce departments were among the first reported victims of the hack. Later reports said networks runs by the State Department and the Energy Department's National Nuclear Security Administration were also affected.

Meanwhile, the Defense Department has said it has yet to uncover any evidence of a compromise.

"To date, we have no evidence of compromise of the DOD Information Network (DODIN)," Defense Information Systems Agency Director Vice Adm. Nancy Norton said late last month. "We are aware of the wide-spread and evolving cyber incident. We continue to assess our DOD Information Network for indicators of compromise and take targeted actions to protect our systems beyond the defensive measures we employ each day."

But officials expect the investigation and remediation efforts to continue well into the future. "This is a serious compromise that will require a sustained and dedicated effort to remediate," today's statement reads.