Pentagon’s $10B cloud computing JEDI contract with Microsoft paused over Amazon’s lawsuit

A U.S. judge has allowed Inc’s motion to temporarily halt the U.S. Department of Defense and Microsoft Corp’s $10 billion cloud computing deal which Amazon said was reflective of President Donald Trump’s undue influence.

In November 2019, Amazon, which had been seen as a front-runner to win the cloud computing contract, had filed a lawsuit after the DoD awarded the contract to Microsoft.

Trump has publicly derided Jeff Bezos, Amazon’s head and has repeatedly criticized the company.

While issuing her preliminary injunction, Judge Patricia Campbell-Smith did not release her written opinion. She has also ordered Amazon to deposit $42 million in the event the injunction was issued wrongfully.

In its lawsuit Amazon stated, the Defense Department’s decision was full of “egregious errors,” which came about as a result of “improper pressure from President Donald Trump, who launched repeated public and behind-the-scenes attacks” to steer the deal away from Amazon “to harm his perceived political enemy” Bezos.

Bezos, the owner of Washington Post, has often been the target of barbs by Trump.

Washington Post’s coverage of Trump has often been critical.

The Pentagon, which had planned to start work on the contract on Friday, said it was disappointed by the ruling.

Lieutenant Colonel Robert Carver, a Defense Department spokesman, said the Pentagon believed “the actions taken in this litigation have unnecessarily delayed implementing DoD’s modernization strategy and deprived our warfighters of a set of capabilities they urgently need.”

It went on to add, it remained “confident in our award of the JEDI Cloud contract to Microsoft.”

Previously, Defense Secretary Mark Esper had denied that there was bias and had said the Pentagon made its choice fairly and freely without external influence.

“The court has confirmed through the injunction that Amazon’s challenges with respect to this procurement are not trivial. It’s not guaranteed that they will prevail but the fact that they got it at all is a big deal,” said Alexander Major, a partner at McCarter & English.


As part of its lawsuit, In January Amazon has asked the court to pause the execution of the JEDI contract which is intended to give the U.S. military better access to data and technology from remote locations.

“We have confidence in the Department of Defense, and we believe the facts will show they ran a detailed, thorough and fair process,” said Microsoft.

Amazon did not immediately respond to requests for comments.

The White House declined comment.

Earlier this week, Amazon Web Services, stated it aims to depose Trump and Esper in its lawsuit over whether Trump was trying “to screw Amazon” over the contract.

Amazon also seeks to question other officials involved in the awarding of the contract. It has alleged that Trump had a history of inappropriately intervening in governmental decisions and called the awarding of the contract to Microsoft “fatally flawed and highly unusual.”

The judge has told Amazon and the Pentagon to confer by February 27 on what portions of the opinion can be released publicly.

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