AI firm Anthropic has initiated legal action against the U.S. Department of Defense (DoD), filing two lawsuits on Monday, March 9, 2026, in response to the Pentagon’s decision to label the company a “supply chain risk.” The lawsuits contend that this designation is unlawful and infringes upon Anthropic’s First Amendment rights.
The dispute escalated following Anthropic’s refusal to grant the military unrestricted use of its artificial intelligence models. The company sought specific safeguards for its Claude AI, requesting guarantees that it would not be deployed for mass domestic surveillance or to power fully autonomous lethal weapons. In contrast, Defense Secretary Pete Hegseth and other officials insisted that the company must accept “all lawful uses” of Claude. President Trump subsequently ordered all federal agencies to “IMMEDIATELY CEASE all use of Anthropic’s technology.”
The “supply chain risk” designation, typically reserved for foreign entities suspected of aiding foreign spies, is an unprecedented application against a U.S. company. Anthropic alleges that these actions are “unprecedented and unlawful” and that “The Constitution does not allow the government to wield its enormous power to punish a company for its protected speech.” The company filed one case in the U.S. District Court for the Northern District of California and another in the U.S. Court of Appeals for the D.C. Circuit.
Anthropic claims the designation has immediate and severe consequences, jeopardizing hundreds of millions of dollars in current and future contracts and business partnerships. “Seeking judicial review does not change our longstanding commitment to harnessing AI to protect our national security, but this is a necessary step to protect our business, our customers and our partners,” a spokesperson for Anthropic stated. The Pentagon has declined to comment on the ongoing litigation.
The controversy has resonated across the tech industry. Dozens of staff from competing AI labs, including Google’s chief scientist Jeff Dean, have filed a brief supporting Anthropic. Senator Ron Wyden has also raised questions with major AI companies regarding their government contracts in the wake of the Pentagon’s ban.
Notably, rival AI company OpenAI announced its own classified deployment contract with the Pentagon around the same time. OpenAI stated that its contract included “more guardrails than any previous agreement for classified AI deployments, including Anthropic’s,” and that it implemented “red lines” against mass domestic surveillance and autonomous weapons. This move by OpenAI, however, also drew criticism from some of its own staff and consumers.