Judge halts Microsoft work on Cloud contract after Amazon suit

Judge halts Microsoft work on Cloud contract after Amazon suit

A federal judge on Thursday ordered a temporary halt of Microsoft's work on a $10 billion military cloud contract, a win for Amazon, which sued the USA government a year ago for awarding the contract to its rival.

Microsoft in October won the Pentagon's Joint Enterprise Defense Infrastructure, or JEDI, cloud contract, estimated to be worth as much as $10 billion over a decade. Amazon and Microsoft did not immediately respond to requests for comment. Amazon believes that President Trump shows bias against the company because the Washington Post, a paper owned by Amazon founder Jeff Bezos, has criticized the President's administration.

A preliminary injunction requested by Amazon was issued by Judge Patricia Campbell-Smith, barring the Department of Defense from starting work on the contract known as JEDI, according to a summary of the ruling.

Amazon also seeks to question other officials involved in the decision and alleged that Trump had a history of inappropriately intervening in governmental decisions. In seeking the injunction the firm had said it was "important that the numerous evaluation errors and blatant political interference that impacted the Jedi award decision be reviewed".

"We are disappointed in today's ruling and believe the actions taken in this litigation have unnecessarily delayed implementing DoD's modernization strategy and deprived our warfighters of a set of capabilities they urgently need", Pentagon spokesperson Robert Carver said in a statement to CNBC. The contract is meant to give the military better access to data and technology from remote locations.

"The judge clearly sees some merit in Amazon's challenge for the award to Microsoft." said Charles Tiefer, a professor at the University of Baltimore School of Law. Amazon and Microsoft were finalists for the lucrative contract, for which Amazon was considered an early front-runner. After the victor was narrowed down to Amazon and Microsoft past year, President Trump said he was looking into the bidding process in response to complaints by IBM and other companies.

It is not the first time a company has accused Mr Trump of improperly swaying the federal government's decision-making due to his objections to media coverage. The court blocked the firm from pursuing White House records, but ultimately approved that deal on other grounds.

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