A federal appeals court in Washington has upheld the Pentagon’s decision to bar AI startup Anthropic from military contracts. The ruling states that the defence department was correct to classify the company as a national security supply chain risk. This classification follows Anthropic’s refusal to allow its technology to be used for autonomous weapons and mass surveillance. Defence Secretary Pete Hegseth argued that these safety restrictions could jeopardise military operations. Anthropic rejects the ruling and is currently weighing its next steps.
The designation has cost the company billions and is hurting its planned IPO. In late August, a federal judge in San Francisco blocked a parallel classification under a different law, calling it unlawful retaliation against Anthropic’s AI safety stance. US intelligence agencies remain heavy users of Anthropic’s AI models, creating a contradiction with the supply chain risk label. The Trump administration appears to be punishing the company because it views Anthropic as left-leaning and woke. President Trump has said as much explicitly. Parts of the tech industry and former military officials have backed Anthropic in the fight.
- The court ruled 2-1 in favour of the Pentagon
- Anthropic’s IPO plans are now in jeopardy
- Intelligence agencies continue to use Anthropic models
