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Anthropic sued the Defence Department for declaring that the artificial intelligence giant posed a risk to the US supply chain, further ramping up a high-stakes dispute with the Pentagon over safeguards on the company\u2019s technology.<\/p>\n
San Francisco-based Anthropic, which recently completed a capital raising that values the company at $US380 billion ($537 billion) is challenging a decision by the department and other federal agencies to shift their AI work to other providers, based on a risk designation typically reserved for companies from countries the US views as adversaries.<\/p>\n
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Siblings Dario and Daniela Amodei founded Anthropic five years ago.Bloomberg<\/p>\n
Anthropic wants a judge to remove the supply-chain risk designation and require US agencies to withdraw directives related to it. The company claims it is being shut out for disagreeing with the administration and argues the legal principles at stake affect every federal contractor whose views the government dislikes.<\/p>\n
\u201cThese actions are unprecedented and unlawful,\u201d Anthropic said in a complaint filed on Monday in San Francisco federal court, adding that the company\u2019s business is being threatened. \u201cThe Constitution does not allow the government to wield its enormous power to punish a company for its protected speech.\u201d<\/p>\n
Last week, the Pentagon formally notified Anthropic of its determination. Chief executive officer Dario Amodei then issued a statement saying the government\u2019s actions were not \u201clegally sound\u201d and had left the company with \u201cno choice but to challenge it in court.\u201d<\/p>\n
According to the complaint, the government\u2019s actions \u201care harming Anthropic irreparably,\u201d putting the company\u2019s contracts with private firms \u201cin doubt\u201d and potentially \u201cjeopardising hundreds of millions of dollars in the near-term.\u201d<\/p>\n
Related Article There are likely to be \u201cenormous\u201d consequences for others, including on those \u201cwhose speech will be chilled; on those benefiting from the economic value the company can continue to create; and on a global public that deserves robust dialogue and debate on what AI means for warfare and surveillance,\u201d Anthropic said.<\/p>\n The dispute erupted last month, after the Pentagon wanted to use Claude for any purpose within legal limits \u2014 and without any usage restrictions from Anthropic. The firm had insisted that the chatbot not be used for mass surveillance against Americans or in fully autonomous weapons operations.<\/p>\n In response, Defence Secretary Pete Hegseth on February 27 ordered the Pentagon<\/a> to bar its contractors and their partners from any commercial activity with Anthropic. In a post on X, Hegseth set a six-month period for Anthropic to hand over AI services to another provider.<\/p>\n Trump blasted Anthropic the same day on his Truth Social network saying the company \u201cmade a DISASTROUS MISTAKE trying to STRONG-ARM the Department of War.\u201d In his post, the president directed US government agencies to stop using Claude.<\/p>\n The company\u2019s lawsuit names as defendants the Department of War \u2014 which the Trump administration uses to describe the Department of Defence \u2014 as well as more than a dozen other federal agencies.<\/p>\n The White House defended the administration\u2019s actions.<\/p>\n Related Article \u201cPresident Trump will never allow a radical left, woke company to jeopardise our national security by dictating how the greatest and most powerful military in the world operates,\u201d spokesperson Liz Huston said. Trump and Hegseth \u201care ensuring America\u2019s courageous warfighters have the appropriate tools they need to be successful and will guarantee that they are never held hostage by the ideological whims of any Big Tech leaders.\u201d<\/p>\n The Department of Defence didn\u2019t respond to a request for comment on the lawsuit.<\/p>\n Anthropic said in the complaint that it imposed \u201cusage restrictions\u201d based on the company\u2019s \u201cunique understanding of Claude\u2019s risks and limitations \u2014 including Claude\u2019s capacity to make mistakes and its unprecedented ability to accelerate and automate analysis of massive amounts of data, including data about American citizens.\u201d<\/p>\n As part of its challenge to the US government, Anthropic also filed a complaint in an appellate court in Washington, DC, focusing on a law governing procedures for mitigating supply-chain risks in procurement. In that suit, the company claimed the Defence Department exceeded its authority with actions that were \u201carbitrary, capricious and an abuse of discretion.\u201d<\/p>\n AI technology<\/p>\n In the days after the department first announced its risk designation, consumers drove \u201cunprecedented demand\u201d for Anthropic\u2019s chatbot Claude in a show of support for the company\u2019s resistance to the government push for unfettered use of its technology.<\/p>\n Meanwhile, rival OpenAI announced it had struck an agreement to let the Pentagon deploy its artificial intelligence models in its classified network. OpenAI chief Sam Altman later said he was working with the Defence Department to add more guardrails around surveillance.<\/p>\n Founded in 2021 by former OpenAI employees, Anthropic quickly cemented itself as a rival to the ChatGPT maker with Claude, which it billed as more safety- and business-focused. Today, the San Francisco-based company has more than 300,000 business customers who use its models to streamline workplace responsibilities, particularly in the field of computer programming where it has emerged as a market leader with its AI coding assistant, Claude Code.<\/p>\n Anthropic started the year on a winning streak, with surging sales, multiple viral products and a large funding round \u2014 all giving the startup a big advantage in the costly global AI race.<\/p>\n Related Article But its future is uncertain since its relationship with the Pentagon imploded in late February \u2014 just before the US attacked Iran in a major Middle East military operation.<\/p>\n Some legal and policy experts warned that the fallout from the government\u2019s declaration would be dire.<\/p>\n Jennifer Huddleston, a senior fellow at the Cato Institute, said the case goes well beyond a contracting dispute and posses a risk to freedom of speech.<\/p>\n \u201cThe designation and attempts to blacklist the company from other aspects of the government go far beyond the scope of what would be considered least restrictive means even if there are security concerns about the further use of the product,\u201d Huddleston said in a statement.<\/p>\n Bloomberg<\/p>\n The Business Briefing newsletter delivers major stories, exclusive coverage and expert opinion. Sign up to get it every weekday morning<\/a>.<\/p>\n Save<\/p>\n You have reached your maximum number of saved items.<\/p>\n![\"Has](\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2026\/03\/1773099608_140_9f1031b30bf914cec651ebeb799e02723517b1c7.jpeg\")
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Defence Secretary Pete Hegseth on February 27 ordered the Pentagon to bar its contractors and their partners from any commercial activity with Anthropic.AP<\/p>\n![\"Cryptocurrency](\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2026\/03\/1e161309f2e15e3e5eb66d0eaefad0575ee59fc0.jpeg\")
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Anthropic quickly cemented itself as a rival to the ChatGPT maker with Claude, which it billed as more safety- and business-focused.AP<\/p>\n![\"Claude](\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2026\/03\/1772682675_817_9541e71c9c0c57299098535611ae3d53fc9a6e0a.jpeg\")
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