IBM comes under stark judgment in the Court of Federal Claims decision regarding the company’s protest against the CIA’s February award to Amazon Web Services of a long-term cloud computing contract.
In a redacted decision (.pdf) posted online Nov. 8, Judge Thomas Wheeler says IBM manipulated its pricing proposal to create a bid protest issue and dismisses IBM arguments that it didn’t do so with the conclusion that “the Court does not see any other explanation for IBM’s final pricing strategy.” The contract is worth up to $600 million in its first four years and could potentially last a decade.
The Government Accountability Office’s decision to uphold IBM’s protest also comes under criticism, with Wheeler stating that the GAO’s June decision to sustain in part the protest lacked a rational basis and that IBM lacked standing to protest, since its proposal had no substantial chance of winning the award in the first place. Among other factors, IBM offered a low initial price to the CIA while including a contract clause in its proposal calling for negotiation of higher prices in later years.
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