Amazon’s lawsuit details allegations of ‘inexplicable’ procurement violations in JEDI contract

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The Defense Department committed “blatant” and “inexplicable” violations of procurement law when it awarded its controversial JEDI Cloud contract to Microsoft, Amazon Web Services alleged in newly-released court documents unsealed on Monday.

In a heavily redacted version of its bid protest lawsuit, AWS painted its own proposal for the up-to $10 billion cloud contract as the obvious choice on a purely technical basis. But as the procurement neared its final days, it said DoD source selection officials committed a series of errors that are impossible to understand without considering President Trump’s personal intervention in the decisionmaking process.

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“DoD applied an unstated evaluation criteria to its review of AWS’s proposal — the unstated criteria that, per President Trump’s directive, AWS not be awarded the JEDI Contract,” Amazon attorneys wrote in the complaint to the Court of Federal Claims. “Under escalating and overt pressure from President Trump, DoD departed from the rules of procurement and complied — consciously or subconsciously — with its Commander in Chief’s expressed desire to reject AWS’s superior bid.”

Numerous key details, such as each vendor’s proposed prices and key facts about their technical approaches, are blacked out from the new, public version of the complaint.

But Amazon told the court that although the issues of political bias the company raised were illegal on their own terms, the Pentagon made such serious errors in evaluating the Microsoft and Amazon proposals that the Oct. 25 contract award must also be thrown out for those reasons alone.

For instance, AWS complained that DoD made important changes to how it would evaluate bids as the procurement neared its final stages in the latter half of this year. The complaint makes much of the fact that Amazon already has deep experience providing cloud services to federal government customers dealing with classified levels of data.

But relatively late in the game, AWS claims, DoD decided to change its selection approach so that Amazon would not be able to use the classified facilities it had already built for federal customers — in effect, artificially raising the price it would have to charge to provide JEDI services.

“DoD — without any technical justification — took affirmative steps to deprive AWS of its competitive advantage over Microsoft and level the playing field so that DoD could justify its award to a technically inferior competitor,” attorneys told the court.

In another example, Amazon claims the department’s source selection evaluation board (SSEB) for JEDI had issued a glowing review of an AWS feature called Nitro, the company’s hypervisor that purports to make it more difficult for potential attackers of a cloud system to gain access to critical, “trusted” parts of the system.

“[Nitro] represents an extraordinary approach to the government’s requirements in this area,” the SSEB wrote in its report, according to Amazon’s complaint. “The separation of tenants within the cloud infrastructure is one of the key security challenges facing cloud providers and a critical security requirement of the RFP … AWS’s solution goes beyond the industry-standard approach.”

But Amazon says, in the end, it did not get proper credit for Nitro, a feature that it considers to be one of the key differentiators in its cloud offering. The company called the decision by JEDI’s final source selection authority and its source selection advisory board “inexplicable,” but the basis of their decision is redacted from the complaint.

However, the lawsuit strongly implies that many of the decisions procurement officials made were influenced by President Trump’s public antipathy for AWS and Amazon’s founder, Jeff Bezos.

The complaint offers no direct evidence that the president personally ordered DoD to torpedo the Amazon bid. But attorneys cited numerous tweets, news articles and other published reports they said made the president’s desires plain.

“Even the Democrats aren’t buying the BS coming from Bezos Inc … sounds like the corrupt #BezosBailout is in trouble,” read one tweet by Donald Trump Jr. cited in the suit.

Amazon also pointed to published accounts in which the president is alleged to have tried to insert himself into the selection process.

In one, according to a book by former Defense Secretary James Mattis’ head speechwriter, the president told Mattis he wanted to “screw Amazon” during its pursuit of the JEDI contract. In another, an article in Vanity Fair, the president was reported to be “obsessed” with Bezos. The magazine quoted a source close to the White House: “Trump is like, how can I f**k with him?”

The Defense Department has said that it took extraordinary steps to shield the JEDI procurement from political influence, including by appointing a source selection advisory board whose members’ identities were kept anonymous. The lawsuit also makes clear that the final source selection authority fully adopted those members’ recommendations.

But the court complaint also suggests that the department has not been willing to defend its procurement decisions in JEDI — at least not to Amazon’s satisfaction — including in the legally-required debriefing it is supposed to give losing bidders after a contract award.

The lawsuit says Amazon gave DoD 265 separate written questions about how it reached its determinations, and got relatively little by way of a response.

“In fact, DoD did not provide a substantive response to a single one of the 265 questions that AWS timely submitted, leaving AWS in the dark about DoD’s explanations for the substantive issues for which AWS raised concern in the debriefing questions. Instead, DoD subjectively determined which of AWS’s questions were ‘relevant’ and then blithely stated that ‘[a]ll 265 questions were reviewed and reasonable responses are provided herein for relevant questions,’” according to the complaint. “What followed, however, was anything but reasonable, with DoD providing broad, overarching responses that generically referenced the Agency’s evaluation reports, and utterly failed to provide a single substantive response.”

The Defense Department has not yet responded to the lawsuit. The government has until Jan. 21 to file its answer with the court. Microsoft, which the court has granted permission to intervene in the case, is expected to file its own separate reponse.

And although the lawsuit asks the court to invalidate the award and force DoD to reopen the bidding process, DoD and Microsoft are free to get to work on building JEDI in the meantime. According to an audio record of court proceedings released last week, Amazon has not asked the court to issue a preliminary injunction that would stop work on the contract until the case is resolved.

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