Amazon Claims It Lost $10B Contract Due to Trump

It wants DOD to cancel the award to Microsoft and re-review the bids
By Kate Seamons,  Newser Staff
Posted Dec 9, 2019 2:23 PM CST
Amazon Blames Trump for Losing $10B Contract
Amazon says President Donald Trump's “improper pressure" and behind-the-scenes attacks harmed its chances of winning a $10 billion Pentagon contract.   (AP Photo/Mark Lennihan, File)

Amazon claims it missed out on a potentially $10 billion contract because of President Trump. That's the assertion in a lawsuit by Amazon Web Services unsealed Monday. The Department of Defense ended up handing the JEDI (Joint Enterprise Defense Infrastructure) contract to Microsoft in late October, a move that AWS alleges came after "behind-the-scenes attacks" from the president, who it alleges has a "personal vendetta against Mr. Bezos, Amazon, and the Washington Post." It wants the DOD to cancel the award and circle back to all the proposals for a fresh look. The latest:

  • CNBC reports the company alleges Trump "intervened directly in the very final phases of the two-year procurement process. ... The question is whether the President of the United States should be allowed to use the budget of DoD to pursue his own personal and political ends," the suit states.
  • By way of background, the AP reports Oracle and IBM were knocked out earlier in the process, leaving Amazon and Microsoft as the ones vying for the contract. Oracle sued, arguing the bidding was rigged in a way that benefited AWS. This summer, Trump got involved, saying he had heard the complaints and wanted the situation reviewed.

  • AWS further pegs Microsoft as a subpar choice, saying the DOD "glossed over wide gaps" between the companies' cloud computing chops. It cited its speed and background in handling classified government data in a secure manner. CNN reports AWS had been seen as the likely winner of the 10-year contract. The Washington Post reports the award came "after more than a year of speculation that Amazon was the only capable bidder."
  • The suit continues, "DOD’s substantial and pervasive errors are hard to understand and impossible to assess separate and apart from the President’s repeatedly expressed determination to, in the words of the President himself, 'screw Amazon.'" Among those alleged errors, per CNN: The DOD didn't review Amazon's final bid, but an earlier one.
  • "Screw Amazon" is an apparent reference to a claim in a book on former Defense Secretary James Mattis that said Trump used those words when allegedly telling Mattis not to award Amazon the contract.
  • The Post notes the DOD also said Amazon would have to build brand new data centers to fulfill the contract, rather than use its data centers that were already able to handle classified data. AWS says there was no technical reason why this would be needed. No other bidders already had existing data centers cleared to house classified data, meaning the decision negatively affected only Amazon.
  • A Pentagon rep pushed back on the idea there were any "external influences" and says "an expert team of career public servants and military officers" made the pick.
(More Amazon stories.)

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