A US judge on Thursday blocked the Pentagon’s blacklisting of Anthropic, a company involved in artificial intelligence development, in a case concerning military applications of AI. Anthropic's lawsuit in California federal court claims that Defense Secretary Pete Hegseth exceeded his authority by designating the company as a national security supply-chain risk. This designation can be applied to companies that may expose military systems to potential infiltration or sabotage. Hegseth’s decision prevented Anthropic from securing certain military contracts after the company declined to allow the military to use its Claude AI models for US surveillance or autonomous weapons.
Anthropic executives have stated that this situation could result in billions of dollars in lost business and damage to their reputation. US District Judge Rita Lin ruled in a 59-page order that the Pentagon’s decision was “illegal and baseless.” She emphasized that “the empty invocation of national security is not a blank check to punish and retaliate against government critics.”
Anthropic expressed approval of the ruling and stated its intention to work productively with the government to utilize AI for national security benefits. The Pentagon did not provide an immediate comment on the ruling.
Anthropic contends that AI models are not sufficiently reliable for use in autonomous weapons and opposes domestic surveillance, citing rights violations. Conversely, the Pentagon argues that private companies should not limit military operations. This designation marked the first instance of a US company being publicly labeled a supply-chain risk under a government-procurement statute designed to protect military systems from foreign threats.
In its lawsuit filed on March 9, Anthropic claimed that the government violated its First Amendment rights by retaliating against its stance on AI safety and that it was not afforded the opportunity to contest the designation, infringing on its Fifth Amendment right to due process. The lawsuit argues that the decision was unlawful, lacking factual support, and inconsistent with previous military endorsements of Claude.
The Justice Department countered that Anthropic’s refusal to comply with contractual terms could create uncertainty for the Pentagon regarding the use of Claude, potentially jeopardizing military operations. The government maintained that the designation was a result of Anthropic's contractual refusals rather than its views on AI safety. Additionally, Anthropic has another lawsuit pending in Washington, DC, regarding a separate Pentagon supply-chain risk designation that may affect its eligibility for civilian government contracts.