Judge rules Pentagon's Anthropic blacklist unconstitutional

A federal judge sided with Anthropic on Thursday, ruling that the Pentagon violated the First Amendment when it blacklisted the AI lab as a "supply chain risk" earlier this year, The Verge reported.

The fight traces back to last winter, when Defense Secretary Pete Hegseth moved to renegotiate every AI lab's Pentagon contract to allow "any lawful use" of the technology, a shift that would have handed the department far broader authority. Most labs signed the new terms. Anthropic, which has ramped up its own Washington lobbying this year, held firm on two restrictions instead: no AI for mass surveillance of Americans, and none for lethal autonomous weapons that can kill without a human in the loop.

The standoff dragged on for months. Department of Defense officials criticized Anthropic in public, and the administration eventually issued an ultimatum. Less than a day before the deadline, CEO Dario Amodei said the company would not change course. Anthropic had "never raised objections to particular military operations nor attempted to limit use of our technology in an ad hoc manner," he wrote, but in a "narrow set of cases," the company believes AI can undermine democratic values rather than defend them.

The Pentagon responded by naming Anthropic a supply chain risk, a label usually reserved for national security threats, and signed new AI contracts with seven rival labs, including Google, Microsoft, OpenAI, and SpaceX.

• March: Anthropic sues over the blacklist in the Northern District of California
• March: Judge Lin temporarily blocks the designation, calling it retaliation for the company's "hostile manner through the press"
• Spring: Google, Microsoft, OpenAI, SpaceX, and other labs sign new Pentagon AI terms
• August 27: Lin's final ruling makes the block permanent

Lin also found Hegseth's designation "arbitrary and capricious." The government's own evidence, she wrote, showed that "the broad measures imposed on Anthropic were illegal and baseless," even though the Pentagon remains "undisputedly free to select the AI vendor of its choice."

Anthropic spokesperson Danielle Ghiglieri welcomed the ruling Thursday, saying the company "remains focused on working productively with the government to harness AI for our national security so all Americans benefit from this technology." The case leaves Anthropic's Pentagon contract status unresolved even as the company pitches investors on a $30 trillion market ahead of a possible IPO.

The ruling doesn't force the Pentagon to buy from Anthropic again. It strips away the label the government used to justify freezing the company out.

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