Federal Circuit U.S. Court of Appeals for the Federal Circuit in Washington D.C. Photo: Mike Scarcella

Oracle Corp., eliminated from the bidding war over a $10 billion U.S. Defense Department cloud-computing contract, on Monday pressed its federal court appeal, just days after the Pentagon awarded rival Microsoft Corp. the lucrative and highly contested government work order.

Oracle is represented in the U.S. Court of Appeals for the Federal Circuit by Craig Holman, who leads the government contracts and national security practices at Arnold & Porter Kaye Scholer. Oracle's opening brief was filed under seal, and a redacted public version is expected to be available next week. Holman declined to comment about Oracle's case.

The appeal comes as questions fly over the Pentagon awarding the cloud contract to Microsoft. Rival Amazon Web Services, another leading contender, reportedly said it was "surprised" by the Pentagon's decision. President Donald Trump has openly and often feuded with Amazon's chief executive, Jeff Bezos, who also owns The Washington Post. Trump regularly derides news coverage of him that he doesn't like as "fake."

Oracle's appeal in the Federal Circuit challenges the contracting process. A judge on the U.S. Court of Federal Claims, where government contracts disputes are adjudicated, dismissed Oracle's complaint in July. Crowell & Moring's Daniel Forman, co-chair of the firm's government contracts group, represented Amazon Web Services as an intervenor—against Oracle—in the litigation.

Reuters reported Monday that Amazon faces two paths if the company decides to challenge the award of the Joint Enterprise Defense Infrastructure, or JEDI, contract to Microsoft. Amazon could ask the Government Accountability Office to pause the award, or the company could sue the U.S. government in the Federal Claims Court, home to billion-dollar cases involving some of the country's biggest law firms.

Trump's appointed two judges to the Federal Claims court: Richard Hertling, a former Covington & Burling lobbyist, and Ryan Holte, formerly an intellectual property professor at the University of Akron School of Law. Hertling likely would not oversee any case involving Microsoft, a company for whom he lobbied while working at Covington. Federal Claims judges serve 15-year terms.

Eight Federal Claims nominees are pending there: Edward Meyers, a partner at Stein Mitchell Beato & Missner, the law firm where White House counsel Pat Cipollone once worked; Kathryn Davis, a senior counsel in the federal programs branch of the Justice Department's civil division; Stephen Schwartz, a partner at Schaerr Jaffe who litigates civil and administrative matters; Grace Obermann, an administrative patent judge at the Patent Trial and Appeal Board; Eleni Roumel, deputy counsel to Vice President Mike Pence; David Tapp of Kentucky, a judge on the Kentucky Court of Justice's 28th Judicial Circuit; Matthew Solomson of Maryland, chief legal officer for the federal government solutions business unit of Anthem Inc.; and Daniel Epstein, a senior associate counsel in the Trump White House.

Oracle's case in the Federal Claims court challenged, among other things, the evaluation criteria the Defense Department used in the solicitation of the cloud-computing contract and the agency's decision to grant a single-award contract rather than a multiple-award contract. IBM Corp. also had sought the cloud contract but was eliminated from the competition.

Arnold & Porter's Holman said in court filings that the Defense Department, with Amazon's help, "delivered a conflict-ridden mess in which hundreds of contractors expressed interest in JEDI, over sixty responded to requests for information, yet only the two largest global cloud providers can clear the qualifications gate for this multi-billion dollar, single award" contract.

The Arnold & Porter team for Oracle included partner Kara Daniels, senior associate Dana Koffman, and associates Amanda Sherwood and Nathaniel Castellano.

The Federal Claims court determined Oracle lacked "standing" to challenge the contracting process. Dorian Daley, the Oracle general counsel, said in August: "We believe that the determination of no standing is wrong as a matter of law, and the very analysis in the opinion compels a determination that the procurement was unlawful on several grounds."

Dorian Daley Oracle general counsel Dorian Daley. Photo: Jason Doiy/ALM

Justice Department lawyers fought Oracle's challenge to the award process. "Oracle merely second guesses discretionary business and technical judgments by DoD or raises meritless legal challenges," the Justice Department said in a court filing.

In the Federal Claims court, Amazon, then still in contention for the Pentagon cloud contract, was an adverse party to Oracle. "Oracle's complaint and motion gloss over, strip of context, or completely ignore the extensive facts that contradict its paper-thin narrative," Forman of Crowell & Moring said in a court filing. Amazon disputed any conflicts of interest marred the process.

Arnold & Porter's Holman in 2013 successfully represented Amazon Web Services in government contracts case in the Federal Claims court. A judge ruled in favor of Amazon in that case, which involved a cloud-computing contract with the Central Intelligence Agency.

 

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