Anthropic sues Pentagon over 'supply chain risk' designation, citing free speech and due process violations — company refused to allow its AI to be used for autonomous attacks, mass surveillance

Source: Tom’s Hardware

Image credit: Getty Images/Bloomberg

Background

Anthropic has filed two federal lawsuits against the Pentagon and other U.S. federal agencies. The lawsuits seek to overturn the Department of Defense’s decision to designate the AI company a “supply chain risk,” a label that blocks Pentagon suppliers and contractors from using its Claude models. National security experts note that this designation has historically been reserved for foreign adversaries.

The dispute stems from a contract renegotiation between Anthropic and the Department of Defense that collapsed in late February. The Pentagon wanted unrestricted access to Claude for “any lawful use,” while Anthropic refused to remove two guardrails:

1. A prohibition on using its models for fully autonomous weapons without human oversight.
2. A prohibition on mass domestic surveillance of U.S. citizens.

Legal Actions

• Supply chain risk designation: Formally issued on February 27; Anthropic was notified on March 3.
• Presidential directive: Former President Trump directed all federal agencies to stop using Anthropic’s technology via a Truth Social post, with a six‑month phase‑out period. (source)

Anthropic argues that current AI models are not reliable enough for fully autonomous weapons deployment and that large‑scale domestic surveillance would violate fundamental rights. The Pentagon counters that private companies cannot dictate how the government uses technology in national‑security scenarios and that Anthropic’s restrictions could endanger American lives.

Industry Impact

• OpenAI: Shortly after Anthropic’s designation, OpenAI’s Sam Altman announced a new Pentagon deal, emphasizing shared principles on human oversight of weapons and opposition to mass surveillance. (details)
• xAI: Elon Musk’s AI company is reported to have been cleared for use on classified Pentagon systems.

Anthropic was previously the first AI lab permitted to operate on the Department of Defense’s classified networks and signed a contract worth up to $200 million in July 2025. The Wall Street Journal reported that Claude has been used in military operations, including intelligence assessments and target identification in the ongoing U.S. conflict with Iran, even after the Pentagon’s designation.

Anthropic’s Position

“The Constitution does not allow the government to wield its enormous power to punish a company for its protected speech,” Anthropic stated in its filing with the U.S. District Court.