Amazon slams Pentagon's approach to fix messy $10 billion JEDI cloud contract, new court docs show

Key Points
  • Amazon Web Services argued the Pentagon's proposed review of the $10 billion JEDI cloud contract award would only succeed at giving Microsoft a "do-over," according to filings made public Tuesday.
  • Earlier this month, lawyers for the federal government asked that a court allow the Department of Defense (DoD) to reconsider its decision to award the JEDI cloud contract to Microsoft. 
  • AWS filed a complaint late last year challenging the DoD's decision to award the contract to Microsoft. 
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.
Jabin Botsford | The Washington Post | Getty Images

In court documents unsealed Tuesday, Amazon's cloud computing arm argued that the Pentagon's proposed corrective action approach over a messy $10 billion cloud contract "is not designed to provide a complete, fair, and effective re-evaluation."

The Joint Enterprise Defense Infrastructure, or JEDI, cloud computing contract could be worth up to $10 billion for services rendered over as many as 10 years. The Pentagon selected Amazon's main cloud rival, Microsoft, for the contract on Oct. 25. Amazon was initially seen as the favorite to win the contract, then Trump said in July he was looking into the contract after IBM and other companies protested the bidding process.

In November, Amazon filed a notice in the U.S. Court of Federal Claims indicating a plan to protest the Pentagon's decision, claiming that the JEDI evaluation process contained "clear deficiencies, errors, and unmistakable bias." Amazon said in court documents made public last December that Trump launched "behind-the-scenes attacks" against the compan that affected the contract. Some of those alleged attacks were detailed in Mattis' recent memoir, in which the former Defense secretary claimed Trump told him to "screw Amazon" out of the contract.

What Amazon wants

Amazon's latest brief comes after lawyers for the federal government asked the U.S. Court of Federal Claims to grant the Pentagon 120 days to reconsider certain aspects of the decision. The DoD would use the time to amend its solicitation of proposals and allow "limited" revisions addressing the provider's technical approach to a specific price scenario.

Amazon is objecting to how that proposed review would be conducted.

It said in Tuesday's filing that the review would enable Microsoft to "resurrect its eligibility while depriving AWS of a reasonable opportunity to revise its proposal" in line with the changed requirements. Amazon has argued that Microsoft should have been disqualified from the award because it offered a "noncompliant storage solution."

The company added that the DoD's review will fail to consider the other "evaluation errors" that were outlined by Amazon in its initial protest of the decision. The filing makes no mention of President Donald Trump, although AWS alleged Trump's repeated criticisms of Amazon and CEO Jeff Bezos influenced the decision process. 

"Instead of addressing the breadth of problems in its proposed corrective action, the DoD's proposal focuses only on providing Microsoft a 'do-over' on its fatally flawed bid while preventing AWS from adjusting its own pricing in response to the DoD's new storage criteria," an AWS spokesperson wrote in an emailed statement to CNBC.

"This attempt to gerrymander the corrective action without fixing all of the serious flaws pointed out in our complaint raises significant questions," the spokesperson added.

In a statement Tuesday, Department of Defense spokesperson Lt. Col. Robert Carver said the Pentagon "disagrees" with Amazon's arguments.

"The Department maintains that the JEDI Cloud contract was awarded based upon a fair and unbiased source selection process, and any re-evaluation on remand will also be conducted in a fair and unbiased manner," he wrote in an emailed statement. "Our goal remains to get this much-needed capability to the warfighter as quickly as possible in compliance with the law and the court."

In February, unsealed court documents showed that Amazon was looking to depose seven "individuals who were instrumental" in the JEDI source selection and "played pivotal roles" in the ultimate awarding of the contract, including Trump. AWS said it's looking to depose Trump about his involvement in the bidding process, including any private conversations that took place or any instructions that were given regarding the award, as well as any "efforts to harm Amazon or AWS."

Aside from Trump, Mattis and Esper, Amazon Web Services is also seeking to depose the Defense Department's chief information officer, Dana Deasy, and the source selection authority, which awarded the contract to Microsoft, as well as the chairpersons of the SSA, according to the documents.

Microsoft did not immediately respond to CNBC's request for comment.

-- CNBC's Lauren Feiner contributed to this report. 

Read more: Trump says he's looking into a Pentagon cloud contract

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