Amazon’s lawsuit over a $10 billion Pentagon contract lays out disturbing allegations against Trump

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“This is an entirely new and astonishing situation,” Charles Tiefer, a law professor at the University of Baltimore who has been teaching government procurement law for 25 years, said. “No one has ever seen a president vocally attack one of the bidders in a procurement. So no one has ever seen anything remotely like the bidder attacked by the president — losing.”

Tiefer is referring to the situation that spawned the sensational lawsuit Amazon (AMZN) filed last November, challenging the Pentagon’s awarding of the $10 billion JEDI cloud contract to Microsoft (MSFT). It alleges that President Donald Trump’s oft-expressed, seething animus for Amazon and Jeff Bezos, its founder and CEO, caused Pentagon officials, “consciously or subconsciously,” to award the contract to Microsoft.

The judge will decide shortly whether to grant the Defense Department’s request, filed last month, to freeze the suit for four months. The department wants a chance to correct an apparent error the judge found in its rationale for selecting Microsoft — a choice that had stunned many observers when announced last October.

Amazon’s Amazon Web Services (AWS) unit had long been considered the front-runner in the contest, because it pioneered the commercial cloud industry; still commands more than twice the market share of its nearest competitor, Microsoft Azure; and is the only vendor already authorized to operate at a “secret” or “top secret” level, having provided cloud services for the Central Intelligence Agency (CIA) since 2013.

WASHINGTON, DC - JUNE 19: President Donald Trump speaks with Satya Nadella, Chief Executive Officer of Microsoft, and Jeff Bezos, Chief Executive Officer of Amazon during an American Technology Council roundtable in the State Dinning Room at the White House in Washington, DC on Monday, June 19, 2017. (Photo by Jabin Botsford/The Washington Post via Getty Images)
President Donald Trump speaks with Satya Nadella, CEO of Microsoft, and Jeff Bezos, CEO of Amazon during an American Technology Council roundtable in the State Dinning Room at the White House in Washington, DC on Monday, June 19, 2017. (Photo by Jabin Botsford/The Washington Post via Getty Images)

The department asked for the pause after the judge issued a startling preliminary injunction in February, barring the Pentagon from going forward with the contract until she could fully hear Amazon’s case. Judge Patricia Campbell-Smith of the Court of Federal Claims found that, based on what she’d seen so far, Amazon’s suit was “likely to succeed.”

In a statement at the time, Microsoft stressed the narrowness of her ruling. “The decision disagreed with a lone technical finding,” the company said in a statement. “The decision does not find error in the Department of Defense’s evaluation in any other area of the complex and thorough process that resulted in the award of the contract to Microsoft.”

Attendees at Amazon.com Inc annual cloud computing conference walk past the Amazon Web Services logo in Las Vegas, Nevada, U.S., November 30, 2017.    REUTERS/Salvador Rodriguez
Attendees at Amazon.com Inc annual cloud computing conference walk past the Amazon Web Services logo in Las Vegas, Nevada, U.S., November 30, 2017. REUTERS/Salvador Rodriguez

But while that’s true, the judge simply didn’t reach the host of other serious faults Amazon has alleged in the Pentagon’s evaluation. She was saying that even the single likely error she found might alone warrant Microsoft’s being declared “ineligible” and eliminated from the competition.

A bold and extraordinary lawsuit filed by Amazon

The case is playing out at two levels. At level one, it is a conventional bid-protest suit — a dry, technical review of 200,000 pages of administrative memos and reports, judging whether career professionals reasonably evaluated the competing offerings vis-à-vis eight “factors” and 55 “sub-factors” laid out in the solicitation request. On its face, Judge Campbell-Smith’s ruling was made at that level, homing in on just one of the errors that Amazon claims afflict six of the eight factors.