A federal appeals court ruled in favor of the U.S. Department of Defense in its legal dispute with AI company Anthropic. A three-judge panel upheld the Pentagon's decision to blacklist the company from all military contracts, citing concerns over supply chain risks.
The conflict began in February 2026 when Defense Secretary Pete Hegseth requested that Anthropic remove safety restrictions from its Claude model to allow for its use in autonomous lethal weapons and domestic surveillance. Anthropic refused this request on February 26.
Following the refusal, the Pentagon officially designated Anthropic a national security risk on March 3, 2026. This decision terminated existing contracts and prohibited other military contractors from utilizing the company's technology.
Defense officials pointed to an incident during a January 3, 2026, operation involving the capture of Venezuelan President Nicolas Maduro as evidence of the model's unpredictable behavior. Judges Gregory Katsas and Neomi Rao supported the Pentagon's position.
The legal landscape remains complex, as a federal court in California recently ruled a parallel government ban on Anthropic unconstitutional. Anthropic has expressed disagreement with the latest appeals court ruling, though it has not confirmed plans for further appeals.
