On Thursday, a federal judge in the United States declared that the sanctions imposed on AI powerhouse Anthropic by the Trump administration were unlawful. The judge determined that the government had taken punitive action against the company due to its outspoken criticism of the Pentagon.
In her detailed 59-page ruling, Judge Rita Lin emphasized, “The unfounded claim of national security does not grant a free pass to punish critics of the government.” She has prohibited the federal entities involved in the case from enforcing the Trump administration’s directive that restricted the use of Anthropic's AI tools, including its Claude AI models. Additionally, she invalidated Defense Secretary Pete Hegseth's classification of the company as a “supply chain risk”—a designation primarily applied to foreign enterprises.
This ruling solidifies the suspension of the sanctions that Judge Lin initially placed in March, and it is effective immediately, pending a possible government appeal.
An Anthropic spokesperson expressed satisfaction with the court's decision, highlighting that the supply chain risk designation was not lawful. Hegseth's unusual action came after Anthropic declined to permit the military to deploy its AI chatbot, Claude, for surveillance purposes or in the development of autonomous weaponry. This decision had significant ramifications for Anthropic, potentially costing the firm billions in lost contracts and damaging its reputation.
Following Anthropic's refusal, Trump criticized the company on social media, branding it as a “radical left, woke company” and labeling it “out-of-control.”
Anthropic argues that its AI models lack the reliability necessary for safe use in autonomous weaponry and opposes domestic surveillance as a breach of individual rights. Conversely, the Pentagon contends that private companies should not have the authority to limit military operations.
The supply chain risk designation was unprecedented for a U.S. company, being the first instance where such a label was applied under a lesser-known government procurement regulation designed to safeguard military systems from foreign interference.
Judge Lin, who was appointed by President Joe Biden, referred to the Pentagon's categorization of Anthropic as “illegal and baseless.”
In its lawsuit filed on March 9, Anthropic claimed that the government's actions infringed on its First Amendment right to free speech in retaliation for the company's stance on AI safety. The lawsuit further argued that Anthropic was denied the opportunity to contest the designation, which violated its Fifth Amendment right to due process.
Anthropic maintained that the government's decision was both factually unsupported and inconsistent with prior military endorsements of Claude. The Justice Department contended that Anthropic's reluctance to lift the restrictions could lead to complications for the Pentagon regarding its use of Claude, potentially jeopardizing military operations.
The government asserted that the designation resulted from Anthropic’s non-acceptance of contractual requirements, rather than its viewpoints on AI safety.
In addition to this case, Anthropic has another lawsuit pending in Washington, D.C., concerning a different supply chain risk designation from the Pentagon that could adversely affect its eligibility for civilian government contracts.
