A federal judge Thursday ordered a temporary block on the JEDI cloud contract, which was awarded to Microsoft, in response to a suit filed by Amazon. Shares of Microsoft fell on the news, while Amazon’s stock was down slightly.
A court notice announcing the injunction was filed on Thursday but wasn’t public. It’s unclear why the documents were sealed.
The Joint Enterprise Defense Infrastructure, or JEDI, cloud computing contract is intended to modernize the Pentagon’s IT operations. The contract could be worth up to $10 billion for services rendered over as many as 10 years. Microsoft was awarded the contract on Oct. 25.
Amazon’s cloud-computing arm, Amazon Web Services, is instructed to earmark $42 million for any “costs and damages” that could be incurred in the event that the “injunction was issued wrongfully,” the filing states. Amazon must file a notice with the courts indicating it has obtained the $42 million by Feb. 20. Microsoft and Amazon must respond to the filing by Feb. 27.
Microsoft and the Department of Defense criticized the ruling.