The US Supreme Court has declined to hear an appeal by Oracle challenging the award of the Pentagon’s now-cancelled $10bn JEDI cloud computing contract to Microsoft.
The decision means that Oracle’s multi-year challenge has run out of legal road. However, the decision was merely a formality given the Defense Department cancelled the contract in July this year.
It subsequently divided the Joint Enterprise Defense Infrastructure Cloud (JEDI) contract between multiple bidders, which are likely to be Microsoft and Amazon Web Services (AWS).
Oracle’s appeal was dismissed by the court on the basis that the enterprise software maker was never in contention to win the lucrative contract over its rivals.
The Austin, Texas-headquartered company had argued a conflict of interest between some Pentagon employees and Amazon, which owns AWS. Oracle sued in 2018 but the Court of Appeals for the Federal Circuit ruled against it last year. The court said the conflicts of interest did not substantially affect the bidding process.
That left the Supreme Court as Oracle’s final legal avenue. But Oracle faced an uphill struggle, with the Biden administration keen for the Supreme Court to reject the appeal and draw a line under the long-running saga.
The JEDI project was set to replace the Pentagon’s legacy computer networks with a single cloud system to store its classified information. The DoD awarded the ten-year contract to Microsoft in October 2019. It was quickly bogged down in legal action from AWS, which had been widely expected to win the contract.
AWS’ pursuit of the contract was derailed when President Donald Trump called for a review of the bidding process, with AWS claiming Trump’s dislike of Amazon CEO Jeff Bezos factored into the decision.
In July 2021 the DoD cancelled the JEDI contract and said it will reopen the procurement process with a multi-vendor arrangement. It said it would open it to Microsoft and AWS as “available market research indicates that these two vendors are the only cloud service providers capable of meeting the department’s requirements”.
As GlobalData analysts predicted back in March, the Biden administration was likely to “conclude that JEDI is more trouble than it’s worth” after “surveying the legal brief-strewn battlefield”.
The replacement programme is called the ‘Joint Warfighter Cloud Capability”. With the amount of time and money invested by involved parties, there will likely be more legal conflicts down the road.