Judge puts a pause on the Pentagon's move to label Anthropic a national security risk

A federal judge on Thursday temporarily blocked the U.S. government's decision to label Anthropic a national security risk. The order gives the AI firm an early win in its legal battle with the Department of Defense, allowing it to continue federal contracts and temporarily avoid being labeled a "supply chain risk."

The fight stems from a disagreement between Anthropic and the Pentagon earlier this year over how its AI could be used in battle. While negotiating a $200 million contract, Anthropic wanted to put limits on how the Pentagon could use its AI for surveillance and autonomous weapons. The Department of Defense argued Anthropic couldn't dictate how it used the systems. The disagreement led the Pentagon to declare Anthropic a "supply chain risk," effectively blacklisting it from contracting for federal government work.

"The record supports an inference that Anthropic is being punished for criticizing the government's contracting position in the press," wrote Judge Rita F. Lin in her ruling, as reported by The New York Times. "Nothing in the governing statute supports the Orwellian notion that an American company may be branded a potential adversary and saboteur of the U.S. for expressing disagreement with the government."

While the case continues, the injunction gives Anthropic breathing room to continue working with federal contractors for now. It also doesn't require the Department of Defense to continue working with Anthropic. The government has seven days to respond before the order goes into effect.

"We're grateful to the court for moving swiftly, and pleased they agree Anthropic is likely to succeed on the merits," an Anthropic spokesperson told Business Insider in a statement. "While this case was necessary to protect Anthropic, our customers, and our partners, our focus remains on working productively with the government to ensure all Americans benefit from safe, reliable AI."

The ultimate result of the case will have wide-reaching impacts for the rest of the AI industry and its work with the federal government. Microsoft filed an amicus brief in the case in support of Anthropic, as did employees from OpenAI and Google. After dropping Anthropic earlier this year, the Pentagon reached a deal with OpenAI to use its AI models.