A U.S. federal judge has granted Amazon.com, Inc. a preliminary injunction that will keep on preventing Microsoft Corporation from beginning work on the $10 billion Joint Enterprise Defense Infrastructure (JEDI).
In her opinion unsealed over the weekend, U.S. Court of Federal Claims Judge Patricia Campbell-Smith said it's likely Amazon will succeed on a key argument of its challenge to a decision in October 2019 by the U.S. Department of Defense (DoD) to award the JEDI cloud computing deal to Microsoft. She also issued an order blocking work on the contract pending resolution of Amazon's court challenge. She said Amazon will probably succeed on the same grounds that formed the basis for the stop-work order, she issued in February.
Campbell-Smith wrote Amazon "is likely to succeed on the merits of its argument that the DOD improperly evaluated" a Microsoft price scenario. She said Amazon will attempt to prove Microsoft's scenario isn't "technically feasible" as determined by the Pentagon.
Amazon, however, also contends the contract was awarded to Microsoft because of improper influence by President Donald Trump. Trump blasted the DoD's awarding the contract to Amazon, which is owned by Jeff Bezos, a foe of Trump.
The opinion neither mentioned Trump nor addressed Amazon's claims of improper influence. Instead, it focused on how the Pentagon assessed Microsoft's data storage in one price scenario.
"In the context of procurement for cloud computing services, the the court considers it quite likely that this failure is material." wrote Campbell-Smith
She found the Pentagon treated Amazon Web Services (AWS), the Amazon subsidiary that sought the JEDI contract, unfairly when it awarded JEDI to Microsoft. She also said Microsoft's bid included a technical approach not allowed under the terms of the contract. This technical approach allowed Microsoft to underbid AWS.
Campbell-Smith said Microsoft's technical approach didn't comply with a provision in DoD's request for proposals requiring information stored in JEDI's cloud data warehouse to be "online" and "highly accessible" to JEDI users "without human intervention."
This omission means Microsoft was able to bid at a lower price because it proposed a "non-compliant" approach to data storage, wrote Campbell-Smith.
"The court considers it likely that [Amazon's] chances of receiving the award would have increased absent defendant's evaluation error. Even if what appears to be a deficiency did not result in [Microsoft's] elimination from competition, a reduction in the price advantage attributed by the Pricing Evaluation Board to [Microsoft's] use of [redacted] storage likely would affect the price evaluation, which in turn would affect the best value determination."
Court documents show the DoD pricing evaluation board that advises on the contract award found Microsoft's data storage approach led to a "significant variance" in price between Amazon and Microsoft's proposals.
DoD contends that delaying the JEDI award will harm national security and nearly double its costs for cloud services. Campbell-Smith disagreed, saying a delay in the JEDI program will simply require DoD to continue using the means by which it is presently accomplishing its important missions "until the court can determine whether the procurement at issue was properly conducted."
