Anthropic is suing the Pentagon over the Trump administration’s “supply chain risk” designation.
On Monday, Anthropic urged the US District Court in Northern California to intervene, arguing that the White House resorted to “unlawful” retaliation after the San Francisco company refused to remove guardrails that prevent its AI technologies from being used for mass surveillance and autonomous weapons.
“The Constitution does not allow the government to wield its enormous power to punish a company for its protected speech,” Anthropic wrote in one of the court documents.
Anthropic is also calling on the court to “grant the emergency relief” and issue a temporary restraining order to block the supply chain risk designation as the case proceeds.
The lawsuit argues that the Trump administration is essentially punishing the company for expressing its views on AI use, in violation of the First Amendment. “The government does not have to agree with those views. Nor does it have to use Anthropic’s products. But the government may not employ ‘the power of the State to punish or suppress [Anthropic’s] disfavored expression,’” it says.
The company also claims it was denied due process and that the White House sanctions have “irreparably” harmed Anthropic after President Trump ordered all federal agencies to ditch the company’s AI products. “Defendants are seeking to destroy the economic value created by one of the world’s fastest-growing private companies, which is a leader in responsibly developing an emergent technology of vital significance to our Nation,” Anthropic adds.
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The Pentagon is expected to disagree. “WE will decide the fate of our Country—NOT some out-of-control, Radical Left AI company run by people who have no idea what the real World is all about,” President Trump said last month after Anthropic refused to loosen safeguards on its AI.
Defense Secretary Pete Hegseth has said that the supply chain risk designation, imposed on Thursday, means that “no contractor, supplier, or partner that does business with the United States military may conduct any commercial activity with Anthropic.” However, Anthropic’s lawsuit notes the Pentagon’s letter about the supply chain risk label “does not explain the scope of procurements covered by the Secretary’s action.”
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It’s why Anthropic has downplayed the threat. CEO Dario Amodei said last week that “the vast majority of our customers are unaffected by a supply chain risk designation,” arguing the blacklisting is narrow in scope and pertains only to defense contracts. Microsoft and Google, which also supply software to the US government, seem to agree, indicating they plan to continue offering Anthropic’s Claude chatbot through their cloud services.
Still, Anthropic’s lawsuit says the supply chain designation has caused major reputational harm, along with millions in losses from military contracts. “The Challenged Actions also inflict immediate and unrecoverable revenue losses: Anthropic stands to lose the federal contracts it already has, as well as its prospects to pursue federal contracts in the future,” the suit adds.
Despite the hostilities, Anthropic notes that it’s still in talks with the Pentagon. “I would like to reiterate that we had been having productive conversations with the Department of War over the last several days, both about ways we could serve the Department that adhere to our two narrow exceptions, and ways for us to ensure a smooth transition if that is not possible,” Amodei wrote last week.
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