Amazon’s Redacted Amended Complaint in JEDI Suit Asks Court to Toss Microsoft’s Contract

On Tuesday, Amazon Web Services’ (AWS) redacted amended complaint was filed in the Joint Enterprise Defense Initiative (JEDI) suit, which urged Judge Patricia E. Campbell-Smith of the Court of Federal Claims to toss the Department of Defense’s JEDI contract with Microsoft after the re-evaluation re-awarded Microsoft the $10 billion contract. The original document was filed under seal in October.

In October 2019 Microsoft won the $10 billion Pentagon contract to move the Department’s data into a secure cloud infrastructure, after which AWS, who also placed a bid to win the contract, accused the government of bias and filed a complaint which was unsealed in December 2019. Meanwhile, in February AWS won a preliminary injunction, the Department of Defense (DoD) filed a voluntary remand, which AWS opposed. Additionally, in April, the DoD’s Inspector General’s Office concluded that the JEDI contract process was fair; Oracle lost its appeal in the litigation in September.

According to the redacted filing, AWS continues to challenge the DoD’s decision to award the JEDI contract to Microsoft, pointing to the agency’s amendments and “reevaluation of proposals in connection with DoD’s purported corrective action in response to AWS’s initial protest.” AWS claimed that the DoD “rejected” the opportunity to remedy “the myriad of prejudicial evaluation errors AWS identified in its initial protest” and ensure the process was fair when the Department re-awarded the contract to Microsoft, which AWS averred “compounds its prior errors to validate a flawed and politically corrupted decision.”

In particular, in the original complaint, Amazon claimed that it found flaws in various aspects of the DoD’s evaluation and selection process. For example, AWS proffered that the “DoD had improperly accepted Microsoft’s noncompliant proposal under the RFP’s Price Scenario 6,” afterwards, “the court halted further performance of the JEDI Contract without ruling on the numerous other fatal flaws in DoD’s award decision.” Moreover, on remand, the DoD relaxed these requirements, which AWS contended was in order to “accommodate Microsoft’s previously noncompliant technical approach to Price Scenario 6.” Consequently, AWS stated in the redacted filing that it adjusted its proposal as a result of the relaxed requirements, which now meant that its proposal cost less than Microsoft’s proposal. Therefore, according to AWS the DoD could no longer “rely on Microsoft’s purported price advantage.” In particular, AWS noted “the only way DoD could direct the re-award to Microsoft was to further distort the evaluation record because, aside from the offerors’ technical approaches to Price Scenario 6 and the resulting total evaluated prices, nothing else changed in the underlying proposals.” Specifically, Amazon pointed to Microsoft’s purported “technical inferiority and now-higher price.”

According to AWS, the DoD “corrected some of the initial errors AWS identified by revising the evaluations either to acknowledge an overlooked AWS strength or to revise an improperly assessed weakness.” However, AWS proffered that the DoD also found “some ‘new’ purported weakness in AWS’s proposal, by identifying ‘new’ supposed technical advantages in Microsoft’s proposal, or by ignoring the RFP’s evaluation criteria entirely.” AWS averred that the re-evaluation that re-awarded Microsoft the contract is “riddled with error.” In the redacted amended complaint, Amazon provided various examples of said alleged errors. Additionally, AWS asserted that this conduct was politically charged, pointing to the President’s opinions of Amazon. AWS claimed that these errors require the court’s scrutiny.

In a statement to Law Street Media, an AWS spokesperson said, “As a result of the DoD fixing just one of many errors, the pricing differential swung substantially, with AWS now the lowest-priced bid by tens of millions of dollars. The fact that correcting just one error can move the needle that substantially demonstrates why it’s important that the DoD fix all of the evaluation errors that remain unaddressed, and ensure they are getting access to the best technology at the best price. We had made clear that unless the DoD addressed all of the defects in its initial decision, we would continue to pursue a fair and objective review, and that’s exactly where we find ourselves today.” 

TechCrunch noted that Frank X. Shaw, corporate vice president for communications at Microsoft, stated, “As the losing bidder, Amazon was informed of our pricing and they realized they’d originally bid too high. They then amended aspects of their bid to achieve a lower price. However, when looking at all the criteria together, the career procurement officials at the DoD decided that given the superior technical advantages and overall value, we continued to offer the best solution.” Additionally, Reuters noted that in a statement Microsoft stated, “it is time we moved on and got this technology in the hands of those who urgently need it: the women and men who protect our nation.”

Meanwhile, the government and Microsoft have filed sealed motions to dismiss Amazon’s amended complaint.

Amazon is represented by Morrison & Foerster LLP and Gibson, Dunn & Crutcher LLP.

The Department of Defense is represented by the Department of Justice and its own general counsel. Microsoft is represented by Rogers Joseph O’Donnell, P.C. and Latham & Watkins LLP.