Judge sides with Pentagon and Amazon in cloud bidding case

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(AP) -- A federal judge is dismissing allegations that bidding for a $10 billion cloud computing contract with the Pentagon was rigged to favor Amazon.

Friday's ruling dismissing Oracle's claims clears the Defense Department to award the contract to one of two finalists: Amazon or Microsoft.

It will be a boon for whichever company gets to run the 10-year computing project, which the U.S. military sees as vital to maintaining its technological advantage over adversaries and accelerating its use of artificial intelligence in warfare.

Oracle and IBM were eliminated during an earlier round, but Oracle persisted with a legal challenge claiming conflicts of interest.

Court of Federal Claims Judge Eric Bruggink said Friday that Oracle can't demonstrate favoritism because it didn't meet the project's bidding requirements to begin with. Bruggink also sided with a Pentagon contracting officer's earlier finding that there were no "organizational conflicts of interest" and no individual conflicts that harmed the bidding.

The Pentagon says it wants to pick a vendor as soon as Aug. 23.

Formally called the Joint Enterprise Defense Infrastructure plan, or JEDI, the military's computing project would store and process vast amounts of classified data, allowing the Pentagon to use artificial intelligence to speed up its war planning and fighting capabilities.

Amazon was considered an early favorite when the Pentagon began detailing its cloud needs in 2017, but faced protests from rivals that opposed the idea of a one-vendor approach. Rivals also accused Amazon executives and the Pentagon of being overly cozy.

Oracle had its final chance to make its case against Amazon — and the integrity of the government's bidding process — in oral arguments Wednesday. The judge ruled two days later.

Oracle spokeswoman Deborah Hellinger didn't address the ruling in a statement Friday but said the company looks forward to working with the Defense Department and other agencies in the future because Oracle's cloud products offer "significant performance and security capabilities" over competitors.

Amazon said in a statement that it "stands ready to support and serve" the Defense Department's mission. It has characterized Oracle's objections as meritless and its conflict claims as "tabloid sensationalism."

In a court filing last month, Lt. Gen. Bradford Shwedo said further delays in the Oracle case would "hamper our critical efforts in AI" as the U.S. tries to maintain its advantage over adversaries who are "weaponizing their use of data." Shwedo said JEDI's computing capabilities could help the U.S. analyze data collected from surveillance aircraft, predict when equipment needs maintenance and speed up communications if fiber and satellite connections go down.