A federal judge ruled the Pentagon and Microsoft (MSFT  ) halt work on the Joint Enterprise Defense Infrastructure, known as JEDI, contract in response to a suit filed by Amazon (AMZN  ). Microsoft shares fell as much as 1% to a low of $182.87 after the report before closing down less than 1%. Amazon shares, which had been in negative territory, rose less than 1%.

The U.S. government can't proceed with the contract "until further order of the court," according to the decision by U.S Court of Federal Claims Judge Patricia Campbell-Smith. The judge ordered Amazon to pay $42 million for any "costs and damages" that could be incurred if the "injunction was issued wrongfully," per filing.

Amazon has alleged that President Donald Trump's hostility toward the company and CEO Jeff Bezos influenced the Pentagon's decision to award the $10 billion contract to Microsoft.

"President Trump's bias against Jeffrey P. Bezos, founder of AWS's parent company, Amazon.com, Inc. ("Amazon"), is a matter of public record," states a motion from the company. "Even before taking office, President Trump campaigned on a promise that Amazon would 'have problems' if he became President."

Amazon cited Trump's grudge against Bezos, "his perceived political enemy," as a contributing factor in awarding the contract. Amazon claimed that Pentagon officials did not review the company's most up-to-date submissions for the JEDI project before issuing the award to Microsoft.

Microsoft spokesperson Frank Shaw said in a statement: "While we are disappointed with the additional delay we believe that we will ultimately be able to move forward with the work to make sure those who serve our country can access the new technology they urgently require. We have confidence in the Department of Defense, and we believe the facts will show they ran a detailed, thorough and fair process in determining the needs of the warfighter were best met by Microsoft."

The government asked the court to reject Amazon's request because it would compromise national security and put a strain on taxpayers. Government lawyers estimated that it would cost between $5 million to $7 million for every month delayed.