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The Trump administration’s dramatic decision to mark Anthropic‘s AI models as a “supply chain risk” earlier this year was illegal, a federal judge has ruled.
“The empty invocation of national security is not a blank check to punish and retaliate against government critics,” wrote Judge Rita Lin in a 59-page ruling. The judge determined the federal government unlawfully retaliated against Anthropic despite its engaging in “constitutionally protected expressive activities.”
Lin pointed to renewed conversations between Anthropic and the federal government, as well as the government’s decision to back away from national security allegations, as corroboration that the designation was an attempt to make a public example of the company, the New York Times reported.
“We welcome the court’s ruling that this supply chain risk designation was unlawful. We remain focused on working productively with the government to harness A.I. for our national security so all Americans benefit from this technology,” Anthropic said in a statement following the decision.
What happened between Trump and Anthropic?
Anthropic filed a series of lawsuits in March, amid a heated back and forth between the developer, the Department of War, and President Donald Trump himself over the government’s potential use of Anthropic’s AI models for nationwide surveillance or lethal autonomous weapons.
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The complaint accused the federal government of engaging in a targeted campaign against the company following the contract disagreement. Anthropic argued that the government’s designation, typically reserved for foreign companies and national security risks, was an overly broad interpretation and “ideologically motivated.”
Trump himself directed an immediate blacklisting of Anthropic products across federal offices, calling the developers “leftwing nut jobs” and Anthropic itself a “radical left, woke” AI company.
Following the fallout, which received widespread attention, Anthropic and the federal government reentered negotiations.
Then, in June, Anthropic was forced to pull its latest Claude Fable 5 and Claude Mythos 5 models under an export control directive from the federal government, citing security concerns about foreign nationals’ access to the technology.
What does the decision mean for AI companies?
Civil society groups see the ruling as a win for free speech proponents amid a government that is increasingly pushing back against dissenters.
“Yesterday’s ruling is a vindication of the First Amendment and a clear reminder that the government isn’t allowed to use national security designations to punish companies or individuals for public criticisms or business disagreements,” said Greg Nojeim, senior counsel at the Center for Democracy & Technology. “Procurement policy can’t be an end run around the Constitution. The Pentagon can pick and choose which products it wants to buy. It can’t use the power of its size and position to stamp out disagreement.”
