Judge rules Pentagon's Anthropic blacklist was illegal retaliation

A federal judge ruled Thursday that the Pentagon illegally retaliated against Anthropic by labeling it a "supply chain risk," according to TechCrunch and ABC News.

U.S. District Judge Rita Lin found the label violated the First Amendment because it retaliated against Anthropic for speech critical of the government, and violated the Fifth Amendment because Anthropic was denied the legal process required before such a designation, TechCrunch reported. "The empty invocation of national security is not a blank check to punish and retaliate against government critics," Lin wrote, according to TechCrunch.

Defense Secretary Pete Hegseth applied the label in February after Anthropic refused to remove safety guardrails blocking the Pentagon from using Claude for autonomous weapons and mass surveillance of Americans, according to ABC News. The government's actions "were based on a desire to make a public example out of Anthropic for its 'arrogance' in criticizing the government," Lin wrote, according to ABC News.

Anthropic sued in March, calling the label an unlawful campaign of retaliation. A separate, narrower Anthropic case over a different Pentagon rule is still pending before a federal appeals court in Washington, and the government is expected to appeal Thursday's ruling, ABC News reported. An Anthropic spokesperson said the company remains "focused on working productively with the government," according to TechCrunch.

The ruling matters beyond one contractor. Any company selling technology to the federal government now has a court decision saying an agency cannot brand a vendor a security threat simply because the vendor declined to remove use restrictions the agency didn't like, a real limit on how much power a government customer can hold over a supplier's own safety terms.