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Google Jostles Microsoft’s Federal E-Mail Contract

WASHINGTON (CN) - Google can temporarily block a contract between the Department of the Interior and Microsoft to provide web-based e-mail services to more than 85,000 department employees, the U.S. Court of Federal Claims ruled.

Without affirming Google's allegations of bad faith and improper conduct, Judge Susan Braden agreed to grant Google's demand for an injunction since the deal would give Microsoft an "organizational lock-in" and curb Google's chance to compete.

Google argued in an October complaint that it was locked out of the competition to migrate the Interior Department's e-mail to a cloud-based system, because the department's notice of the contract stipulated that bidders had to use Microsoft's Outlook e-mail program.

Braden's ruling, which was unsealed on Tuesday, states that Google sufficiently argued that Interior Department violated federal laws on contract competition to win the injunction. She added that the department failed to provide an adequate administrative record for its decision or prove that delaying the contract would cause substantial harm.

The Mountain View, Calif.-based Google, on the other hand, would suffer "immediate and irreparable harm" if the deal proceeds, Braden found.

The judge found that Rhea Suh, the assistant secretary for policy, management and budget overstepped her authority by issuing several statements backing Mircrosoft for the deal. Suh's Determination and Findings reports noted how Microsoft's applications and software met department-wide standards, and the department decided to contract with Microsoft based upon those findings.

Braden said Suh acted outside the chain of command and performed a role not included in her job description.

Suh's findings created a "quintessentially 'non-competitive procedure'" by mandating a single supplier, the ruling states.

Single suppliers are allowed under federal law, but the department procurement officer has to justify that procedure in contracts worth more than $50 million, Braden wrote. "In this case the chief information officer, not the assistant secretary," is the procurement officer.

The Competition in Contracting Act requires full preservation of the entire procurement process, from the determination that a purchase is necessary to final contracts, but the judge found that the administrative record in the Microsoft deal was incomplete.

Braden cited a "striking example" of the incomplete record, noting that there are no documents between a July 31, 2009, e-mail referencing a meeting with Microsoft and a Sept. 24, 2009, e-mail from Interior's Chief Technology Officer expressing hope for a "successful project outcome" with the Mircrosoft team.

"It is inconceivable that Interior decided to commit to 'Microsoft's team to achieve a successful project outcome' within 30 days without other internal documents being generated," the ruling states.

So far, the administrative record clears Microsoft of any misconduct allegations, Braden wrote, adding that the company's actions "show only competitive zeal and interest in customer satisfaction."

While emphasizing that she has made "no judgment as to whether Interior's basis for this procurement was rational or whether the procurement was conducted in a manner that was arbitrary and capricious," Braden wrote that her order allows the department to correct the deficiencies she noted in the process and a chance to reconsider the Google Apps offering.

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