Amazon wins a round in Pentagon lawsuit

Judge declines to toss tech giant’s challenge of $10-billion JEDI cloud contract awarded to Microsoft.

A Federal Claims Court judge on Wednesday declined to toss out Amazon.com Inc.’s claims that political interference cost the company a lucrative Pentagon cloud contract, throwing the entire project into doubt.

Judge Patricia CampbellSmith in Washington rejected requests by the government and Microsoft Corp., which was awarded the cloud computing deal in October 2019, to dismiss Amazon’s

bias allegations because the company failed to raise them early enough. Her full opinion in the matter was filed under seal.

The contract for the project, known as the Joint Enterprise Defense Infrastructure, or JEDI, is valued at as much as $10 billion over a decade.

The ruling means the lawsuit will proceed and doesn’t represent a final decision in the case. However, the Pentagon said earlier this year that if the court didn’t grant its motion to dismiss Amazon’s bias allegations, it would reassess the future of the project altogether to avoid a long court battle.

“The prospect of such a lengthy litigation process might bring the future of the JEDI Cloud procurement into question,” the Pentagon said.

Amazon Web Services, Amazon’s cloud unit, filed a lawsuit in November 2019 asserting that the Defense Department ignored Amazon’s superior technology and awarded the contract to Microsoft despite its “key failures” to comply with requirements. The Pentagon made those errors because of improper interference by then-President Trump, who considered Amazon founder Jeff Bezos his “political enemy,” according to Amazon’s lawsuit.

Amazon applauded the judge’s ruling in a statement.

“We are pleased the court will review the remarkable impact it had on the JEDI contract award,” the company said. “AWS continues to be the superior technical choice, the less expensive choice, and would provide the best value to the DoD and the American taxpayer.”

Microsoft downplayed the decision.

“This procedural ruling changes little. Not once, but twice, professional procurement staff at the DoD chose Microsoft after a thorough review,” Microsoft spokesman Frank Shaw said in a statement.

Representatives for the Pentagon didn’t immediately respond to requests for comment.

Amazon earlier asked the court to let it question Trump and former Pentagon leaders to bolster its case that political interference cost the company the cloud deal. Among the former officials Amazon wants to depose are Trump, former Defense Secretaries Jim

Mattis and Mark Esper and Dana Deasy, who was the Pentagon’s chief information officer.

The e-commerce giant’s lawsuit chronicles a long list of comments and actions by Trump and the Defense Department that Amazon says shows the Pentagon bowed to political pressure when it awarded the deal to Microsoft. In one case, Amazon cites claims in a book by Mattis’ former speechwriter, Guy Snodgrass, that Trump told Mattis in the summer of 2018 to “screw Amazon” by locking it out of the bid. Mattis has criticized the book.

But government lawyers countered that Amazon’s request to depose Trump was “particularly audacious” and unnecessary because the company had failed to offer enough evidence to support its claims of bias.