Federal Judge Finds Pentagon's Designation of Anthropic as Supply-Chain Risk Unlawful

U.S. District Judge Rita Lin issued a written order Thursday finding that the Department of Defense acted outside legal authority when it designated artificial-intelligence company Anthropic as a supply-chain risk. The judge said the Pentagon's move was motivated by a desire to make an example of Anthropic for its criticism of government AI policies, rather than any concrete evidence that the firm would sabotage its models.

Anthropic had sued the Pentagon in March, alleging an unlawful campaign of retaliation after the company refused to permit unrestricted military use of its technology. In a statement, an Anthropic spokesperson said the company welcomed the ruling and remained focused on cooperating with the government to apply AI for national security.

Lin, a Biden-appointed judge, wrote that neither the Constitution nor the federal statute cited by the Pentagon permits sweeping penalties based primarily on Anthropic’s critique of administration views. She previously blocked the agency from enforcing the supply-chain risk label and from applying a former president’s directive that barred federal agencies from using Anthropic’s chatbot Claude.

Department of Justice lawyers argued that the size and opacity of AI models make them difficult to evaluate like traditional hardware, while Anthropic counsel Michael Mongan said the government’s actions “profoundly harm Anthropic” and could chill speech on a critical issue.

The ruling is expected to be appealed, and the Pentagon has indicated it will contest the decision.