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Pentagon might scrap JEDI contract if AWS wins legal challenge

The DoD is being put off by the prospect of protracted legal dispute, suggesting it might be simpler to start from scratch

The US Department of Defense (DoD) might scrap the entire Joint Enterprise Defense Infrastructure (JEDI) contract and start from scratch if AWS is successful in its legal challenge.

The $10 billion Pentagon contract, first announced in 2018, lasts a decade and is supposed to provide a means for the US military to modernise its technology infrastructure. Microsoft secured the contract in October 2019, but this decision was challenged by AWS.

The DoD’s CIO John Sherman has since told Congress that a significant ruling on this case is expected within the coming weeks and that the US administration is preparing for all eventualities.

Critically, should the court rule in AWS’ favour, Sherman has hinted that the DoD might scrap the contract and begin again from scratch.

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This is because the charge AWS is fighting must be “substantively litigated”, and might involve protracted proceedings including requests for depositions of senior White House and DoD officials, including former officials.

These proceedings will be complex and elongate the timeline significantly, further pushing forward the potential start date for the “urgent” work.

The DoD is prepared to proceed with the JEDI contract should the government win its motion to dismiss Amazon’s challenge, which is the case currently being considered.

This is because subsequent proceedings might only last “four or five months”. If the government loses its motion, however, the prospect of a lengthy court battle which could stretch into years threatens the future of the JEDI deal.

“Regardless of the JEDI Cloud litigation outcome, the Department continues to have an urgent, unmet requirement,” the memo said. “Specifically, the Department’s need for an enterprise-wide, commercial cloud services for all three classification levels, extending from the homefront to the tactical edge, at scale.

“We remain fully committed to meeting this requirement—we hope through JEDI—but this requirement transcends any one procurement, and we will be prepared to ensure it is met one way or another.”

Amazon has consistently argued that the $10 billion JEDI contract was unfairly awarded to Microsoft, claiming the decision was “politically corrupt” in December last year, for example. This is despite an eventual DoD review backed the original decision, finding that the contract was, in fact, fairly awarded to the Windows operating system developer. 

Oracle, another cloud giant that had been in the running for the agreement, also failed in its own efforts to appeal the decision in September 2020. 

AWS has a much stronger claim than Oracle, however, and has vowed to continue fighting the Pentagon decision until it’s exhausted all legal avenues. 

The Court of Federal Claims (COFC), which is considering a government motion to dismiss Amazon’s case, is expected to make a significant ruling in the coming weeks. 

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