A federal judge has temporarily halted the Pentagon's effort to designate AI company Anthropic as a supply chain risk, ruling that the move appeared driven by retaliation rather than legitimate security concerns. In a 48-page order, U.S. District Judge Rita Lin, appointed by former President Joe Biden, granted Anthropic a preliminary injunction against 17 federal agencies, including the Pentagon, preventing them from enforcing the ban until the lawsuit concludes. This keeps Anthropic's Claude AI accessible to government users amid escalating tensions over military contracts.
The conflict erupted during negotiations to expand a $200 million Pentagon contract with Anthropic. Anthropic refused proposed language permitting "all lawful use" of its AI, citing risks like mass surveillance or autonomous weapons—a stance CEO Dario Amodei publicly emphasized. In response, President Donald Trump posted on Truth Social on February 27 directing agencies to "IMMEDIATELY CEASE all use of Anthropic’s technology," while Defense Secretary Pete Hegseth announced on X that no military partners could engage with the firm.
On March 4, the administration formalized the designation under two statutes: 41 USC 4713 for federal-wide restrictions and 10 USC 3252 for Defense Department-specific actions. Anthropic swiftly filed lawsuits in California's Northern District and the DC Circuit, arguing the labels were pretextual punishment for its ethical safeguards. Judge Lin agreed, noting the government's shift from contract disputes to broad bans suggested improper motives.
Pentagon Chief Technology Officer Emil Michael countered on X that Lin's order contained "dozens of factual errors" and insisted the 41 USC 4713 designation remains in effect, as it falls outside her jurisdiction . Anthropic welcomed the swift ruling, reaffirming its commitment to safe AI while awaiting DC Circuit decisions. Legal experts are split: some see the injunction as limited, potentially leaving parts of the ban intact.
This case underscores deepening rifts between AI firms and the government over technology controls in national security.It raises questions about executive power to penalize contractors, the role of public statements in legal proceedings, and AI deployment ethics amid rapid advancements. As appeals loom in the 9th Circuit, the dispute could drag on for years, impacting federal AI adoption and Anthropic's partnerships.