A US appeals court has rejected Oracle Corp.’s challenges to the disputed $ 10 billion Pentagon cloud computing contract.
Oracle had raised a number of issues, including allegations of conflicts of interest with Amazon.com Inc., and claims that the Pentagon violated its own rules when it established the contract to be awarded to a single company. The US Court of Appeals for the Federal Circuit upheld a lower court ruling that Oracle was not harmed by any mistake the Pentagon made in developing the contract proposal because it would not have qualified for the contract anyway.
Oracle was fighting its exclusion from the pursuit of the lucrative cloud computing deal, known as the Joint Enterprise Defense Infrastructure, or JEDI. The Pentagon awarded the contract to Microsoft Corp. in October for market leader Amazon Web Services. The project, which is worth up to $ 10 billion over a decade, is designed to help the Pentagon consolidate its technology programs and quickly transfer information to fighters around the world.
Oracle argued that the Defense Department unfairly and unnecessarily adapted the contract requirements for Amazon.com Inc. and Microsoft. The company also alleged that the bidding process was fatally affected by conflicts of interest, including former Pentagon employees who worked for Amazon after helping craft the bid.
“Despite the wide range of claims presented by Oracle, we did not find any reversible errors” in the US Court of Federal Claims decision to reject those arguments, Circuit Judge William Bryson wrote to the three-judge panel.
Representatives for the Pentagon, Amazon, Microsoft and Oracle did not immediately respond to requests for comment.
The ruling is a victory for the Pentagon, which for the past three years has faced criticism from lawmakers, industry and even President Donald Trump for its decision to choose just one company for the lucrative cloud deal. The Department of Defense has said that choosing a supplier for the project will reduce technical complexity and security risks.
The Pentagon also faces allegations of vendor bias in a separate lawsuit from Amazon Web Services, Amazon’s cloud unit, which is suing the Defense Department over claims that the Pentagon did not judge its offer fairly because Trump saw the director. Jeff Bezos, an Amazon executive, as his “political enemy.”
The Defense Department inspector general found in April that the contract award was unaffected by any interference from Trump, though he said his investigation was limited by the White House.
The case is Oracle America Inc. V. U.S., 19-2326, United States Court of Appeals for the Federal Circuit (Washington).
