Palantir wins lawsuit over US Army data system

Palantir wins lawsuit over US Army data system
© Getty Images
A federal judge has ruled in favor of Palantir Technologies, Inc., in a lawsuit that arose from a dispute over access to a contract to build a data system for the U.S. Army.  

The data-analysis company, co-founded by Peter Thiel, will now have the chance to compete for a contract to build a portion of the $6 billion Distributed Common Ground System-Army (DCGS-A) system.

ADVERTISEMENT

The Army plans to use DCGS-A to aggregate and then analyze intelligence from sources like drones, satellites and radar.

Palantir had sued the Army in the U.S. Court of Federal Claims, claiming Army officials operated in bad faith and with bias when they canceled planned tests of Palantir’s technology, according to Bloomberg. 

The Palo Alto, Calif., tech company claimed that the Army had barred it from competing for contracts because the firm’s officials could not show how its technology would work with the Army’s current intelligence systems.

Palantir alleged that the Army had broken the law by not complying with rules that say the government must opt for commercially available products as opposed to custom ones. 

An Army spokesperson declined to comment on the oral opinion released on Monday. The spokesperson wrote in a statement that the Army will proceed on potentially commenting after a review of the to be released formal court opinion.

“This decision removes one of the key barriers blocking innovators from the defense and government markets," said Doug Philippone, who leads the Global Defense program for Palantir. 

Friday’s ruling comes as startups have faced barriers to entry into government contracting.   

Only Palantir and SpaceX have secured government contracts in the hundreds of millions, according to a Bloomberg report. Both have sued their government customers to gain potential opportunities for contracts.

Palantir has made headlines in recent months over several controversies. In March, BuzzFeed wrote a report of the data analysis company’s supposed ailing financial status. In September, the Labor Department filed a suit against Palantir over alleged discrimination in its hiring practices.

This story was updated at 6:35 p.m.