In granting an injunction to stop work on JEDI, judge says AWS 'likely to succeed' in its protest objecting to the $10 billion award to Microsoft.
In ruling that the Defense Department and Microsoft should temporarily stop working on the JEDI cloud project, a federal judge has said DOD made mistakes in how it evaluated pricing and those mistakes harmed Amazon Web Services' chances to win.
Based on that, U.S. Court of Federal Claims Judge Patricia Campbell-Smith wrote that AWS is “likely to succeed” in its lawsuit objecting to the award to Microsoft.
The injunction was put in place last month, but the redacted version of that decision was not released until Friday.
Campbell-Smith's decision focuses on a single aspect of the price evaluation. She doesn’t mention nor rule on the AWS claims that it lost the $10 billion cloud infrastructure contract because of political bias. Still pending before the court is AWS’ request to depose President Trump and several Defense Department officials.
The issue at the heart of the injunction involves the pricing for application and data storage, and only one scenario relating to “Containerized Data Analysis Framework.”
Part of AWS’ argument centers around how the term “highly accessible” was applied to the proposals by the two bidders.
In comments to the Washington Post, DOD expressed disappointment in the decision and Microsoft pushed the company's viewpoint that the ruling was not a big deal because she only wrote about one of many scenarios under one of many factors in the solicitation.
“The decision disagreed with a lone technical finding by the Department of Defense about data storage under the evaluation of one sub-element of one price scenario,” Microsoft spokesman Frank Shaw said in a statement to the Post. “While important, there were six pricing scenarios, each with multiple sub-elements, and eight technical factors, each with numerous subfactors evaluated during the procurement.”
Shaw said the ruling doesn’t find errors in any other area of the source selection process.
AWS described the business risks it sees as part of its argument that an injunction on the Joint Enterprise Defense Infrastructure program is needed while the protest moves forward.
Jennifer Chronis, AWS' DOD leader, told the court that Microsoft would have an unfair competitive advantage if it were allowed to proceed on JEDI in the event that the judge rules in favor of AWS and orders a new competition.
“Any additional contract performance would give (Microsoft) access to further non-public information that would allow (Microsoft but not AWS) to better tailor any revised proposal submitted in a JEDI recompetition,” she said.
Chronis also told the court that AWS would lose customers during the initial stages of JEDI because they would be participating in pilot programs to start the contract. In a footnote, the judge says DOD disputes this point and the court doesn’t have enough facts to rule on that argument.
DOD also said that AWS’ claims of harm are “too speculative.” But the judge disagreed, saying that AWS provided specific examples of losses it could reasonably expect, “including loss of competitive advantage in any renewed competition and damage to (AWS’) ability to serve its customers.”
Microsoft argued that AWS’ claim of irreparable harm should be rejected because it waited nearly 90 days to ask for the injunction.
The judge wrote that delay "weakens (AWS’) claim of irreparable harm," but at the same time "does not find that it invalidates (AWS’) position altogether."
The injunction will remain in place until the court decides to lift it. The judge also asked that AWS put up security of $42 million to cover costs and damages if the court ultimately rules against them.
Still ahead are rulings on whether AWS can dispose President Trump, Defense Secretary Mark Esper, former Defense Secretary John Mattis, DOD CIO Dana Deasy and unnamed DOD procurement officials that make the source selection decision. AWS claims there was bias against it because of Trump’s dislike of Jeff Bezos, Amazon founder and CEO.
Also pending are motions filed by DOD and Microsoft to dismiss the case. AWS filed its responses to those motions on March 6 but those filings are under seal and not yet publicly available.