Judge grants Amazon bid to pause Microsoft's Pentagon contract work

By David Shepardson and Nandita Bose

WASHINGTON (Reuters) – A U.S. judge on Thursday granted Amazon.com (NASDAQ:) Inc’s request for a preliminary injunction to pause the U.S. Department of Defense and Microsoft Corp (NASDAQ:) from moving forward on an up-to-$10 billion cloud computing deal.

Judge Patricia E. Campbell-Smith issued the injunction but did not release her written opinion. She also ordered Amazon to post $42 million in the event that the injunction was issued wrongfully.

Amazon filed a lawsuit in January alleging that President Donald Trump, who has publicly derided Amazon head Jeff Bezos and repeatedly criticized the company, exerted undue influence on the decision to deny it the $10 billion contract.

As part of the lawsuit, Amazon asked the court to pause the execution of the contract, popularly known as the Joint Enterprise Defense Infrastructure Cloud, or JEDI. The contract is intended to give the military better access to data and technology from remote locations.

The Pentagon declined comment on Thursday. Amazon and Microsoft did not immediately respond to requests for comment.

Bezos also owns the Washington Post, whose coverage has been critical of Trump and which has frequently been a target of barbs by Trump about the news media.

Earlier this week, Amazon’s cloud computing unit, Amazon Web Services, said it was seeking to depose Trump and Defense Secretary Mark Esper in its lawsuit over whether the president was trying “to screw Amazon” over the contract.

The procurement process has been delayed by legal complaints and conflict of interest allegations. Esper has denied there was bias and said the Pentagon made its choice fairly and freely without external influence.

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