A federal judge today ordered the Pentagon to stop work under the Joint Enterprise Defense Infrastructure contract and directed Amazon to post $42 million in security to potentially account for the cost of delaying the cloud services award.
In a sealed order, Judge Patricia Campbell-Smith granted Amazon Web Services' request for a temporary restraining order and preliminary injunction as part of the company's protest in the Court of Federal Claims. The Pentagon awarded the potential 10-year, $10 billion JEDI contract to Microsoft last year.
The Defense Department is "preliminarily enjoined from proceeding with contract activities" under JEDI "until further order of the court," according to a filing posted today.
Defense Department spokesman Lt. Col. Robert Carver said in a statement that DOD was "disappointed in today's ruling and believe 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. However, we are confident in our award of the JEDI Cloud contract to Microsoft and remain focused on getting this critical capability into the hands of our warfighters as quickly and efficiently as possible."
Allowing the Pentagon to continue work under the contract would cause AWS "irreparable harm," Amazon’s lawyers argued in court filings last month. "In the absence of a temporary restraining order and preliminary injunction, AWS could lose the opportunity to perform the JEDI contract, earn the revenue and profits resulting from contract performance, ensure its technology is widely used by DOD, and gain additional experience working with the government," they wrote.
However, DOD argued that delaying work on the JEDI contract would cost the government between $5 million and $7 million per month by forcing military organizations to use other, more expensive cloud contracts.
Because the preliminary injunction could last at least six months, they argued, AWS should be forced to post bond "no less than $42 million in security to account for the potential delay."
The judge agreed with DOD and directed Amazon to put up "security in the amount of $42 million for the payment of such costs and damages as may be incurred or suffered in the event that future proceedings prove that this injunction was issued wrongfully," according to today's filing.
DOD officials also argued any further delay on the cloud services contract will impede critical digital modernization efforts, including initiatives to scale artificial intelligence across the U.S. military.
"The continued absence of DOD-wide, enterprise cloud computing capability seriously impedes the military's ability to collaborate and share information with our military services, partner nations, and the intelligence community," Lt. Gen. Bradford Shwedo, the Joint Staff's director for command, control, communications and computers/cyber, wrote in a declaration filed by DOD's lawyers this week.
Before the stop-work order, the Pentagon had planned to begin migrating several "early adopter" DOD organizations to an unclassified version of the JEDI cloud this month. But DOD agreed not to issue any "substantive task orders" under the JEDI contract until the court decided on Amazon’s stop-work request, according to court filings.
Amazon’s lawsuit alleges Defense Department officials "took numerous actions to systematically remove" the company's edge in the JEDI contract competition after President Trump publicly criticized Amazon and its chief executive Jeff Bezos.
Amazon is now seeking to depose President Trump, Defense Secretary Mark Esper and former Defense Secretary Jim Mattis, among other officials.