Anthropic files a lawsuit to stop the Pentagon's blacklisting of AI users

Anthropic has filed a lawsuit against the U.S. Department of Defense (Pentagon) to stop it from placing the AI company on a national security blacklist, intensifying a dispute over how its artificial intelligence technology can be used by the military.

The lawsuit, filed in a federal court in California on Monday, argues that the designation is unlawful and violates the company’s constitutional rights to free speech and due process. Anthropic asked the court to cancel the designation and prevent federal agencies from enforcing it.

The conflict began after Pete Hegseth, the U.S. Defense Secretary, placed a formal supply-chain risk label on Anthropic last week. The decision restricts the military’s use of the company’s AI technology, which a source said had previously been used in military operations linked to Iran.

According to reports, the Pentagon took the step after Anthropic refused to remove safeguards in its AI systems that prevent the technology from being used for autonomous weapons or domestic surveillance.

Anthropic said the government’s actions are unprecedented and amount to punishing the company for maintaining its ethical restrictions. The company also said the move could set a dangerous precedent for technology firms working with the government.

Despite the lawsuit, Anthropic officials said they remain open to negotiations with the U.S. government to reach a settlement. However, a Pentagon official said last week that discussions between the two sides had stopped.

The designation could significantly affect Anthropic’s government business. However, CEO Dario Amodei said the blacklist currently has a limited scope and that companies can still use Anthropic’s AI tools in projects unrelated to the Pentagon.

The dispute has also drawn political attention. Donald Trump has directed the government to stop working with Anthropic, and officials announced a six-month phase-out of existing arrangements. The company’s investors include major technology firms such as Google and Amazon.

The Pentagon has argued that national law—not a private company—should determine how AI can be used to defend the country. Officials insist the military must retain flexibility to use artificial intelligence for any lawful purpose.

Anthropic, however, says current AI systems are not reliable enough for fully autonomous weapons and that using them in such roles could be dangerous. The company has also said it will not allow its technology to be used for large-scale domestic surveillance of American citizens.

The dispute could influence how other AI companies negotiate rules for military use of their technology. Over the past year, the Pentagon has signed agreements worth up to $200 million each with major AI firms including OpenAI and Google.

Meanwhile, OpenAI—backed by Microsoft—recently announced a separate deal to integrate its technology into the Defense Department’s network, with CEO Sam Altman saying the company supports human oversight in weapons systems and opposes mass surveillance in the United States.