JEDI injunction decision hinges on cloud storage definition

Conflicting interpretations of “highly accessible storage” are at the center of a federal judge’s ruling granting Amazon Web Services a preliminary injunction that freezes task orders on the Defense Department’s massive Joint Enterprise Defense Initiative.  The JEDI cloud contract was awarded to Microsoft last fall.

In a Feb.13 ruling unsealed on March 6, Judge Patricia Campbell-Smith said AWS was "likely to succeed" in establishing that DOD made errors in evaluating JEDI bids because of its claim that Microsoft submitted a noncompliant proposal.  

One of the pricing scenarios required in the bids was for a containerized data analysis framework. A revision to the solicitation asked the offerors to assume that “all data in these price scenarios is highly accessible unless otherwise stated.” When DOD was asked to clarify what “highly accessible” meant, it said: “The term ‘Highly Accessible’ is meant to be understood as online and replicated storage.”

Because it had not been defined elsewhere in the solicitation, AWS interpreted “replicated storage” to mean something different from online storage, understanding it to mean “the practice of storing data more than once so that there are multiple copies of the data.” Microsoft, on the other hand, took it to mean online storage, so its bid was lower, even though it did not meet the technical requirements, AWS claimed.

That’s where DOD erred in its evaluation of the proposals, AWS said. It said DOD should have found Microsoft’s “technical approach unfeasible, assigned a deficiency, and eliminated [the company] from the competition,” the ruling quoted.

Campbell-Smith said the court concluded that AWS likely to succeed on the merits of its argument that the DOD improperly evaluated Microsoft’s pricing scenario.

“In the context of a procurement for cloud computing services, the court considers it quite likely that this failure is material. As such, plaintiff likely is correct that defendant should have assigned a deficiency to intervenor-defendant’s proposal,” the judge wrote.

Microsoft expects to prevail in the case, according to a statement from Frank X. Shaw, the company's vice president of communications.

"The decision disagreed with a lone technical finding by the Department of Defense about data storage under the evaluation of one sub-element of one price scenario," Shaw said. "We have confidence in our technology, our bid, and the professional staff at the Department of Defense. We believe that we will ultimately be able to move forward with the work."

Shaw said the ruling doesn’t find errors in any other area of the source selection process.

The injunction will remain in place until the court decides to lift it. The judge also asked that AWS put up security of $42 million to cover costs and damages if the court ultimately rules against it.

The court also rejected DOD's arguments that national security requirements for advanced cloud services -- articulated in detail in Oracle's separate lawsuit on the JEDI program -- mitigated the immediate issuance of JEDI task orders.

"The court does not find, under the present circumstances, that the benefits of the JEDI program are so urgently needed that the court should not review the process to ensure the integrity of the procurement," Campbell-Smith wrote.

Still ahead are rulings on whether AWS can depose President Donald Trump, Defense Secretary Mark Esper, former Defense Secretary John Mattis, DOD CIO Dana Deasy and unnamed DOD procurement officials who made the source selection decision. AWS claims there was bias against it because of Trump’s dislike of Amazon founder and CEO Jeff Bezos.

Also pending are motions filed by DOD and Microsoft to dismiss the case. AWS filed its responses to those motions on March 6 but those filings are under seal and not yet publicly available.

Susan Miller, GCN editor, contributed to this article, which combines two reports, first filed on FCW and Washington Technology.