U.S. appeals court upholds designation of Anthropic as supply chain risk
Legal Defeat for Anthropic: Appeals Court Affirms Pentagon's "Supply Chain Risk" Label
Published: September 25, 2026 | Updated: 3 hours ago | Reporter: Ashley Capoot
📌 Executive Summary
- Court Ruling: A Washington, D.C. federal appeals court has upheld the Department of Defense (DOD) decision to blacklist Anthropic.
- The Designation: The DOD officially categorized the AI firm as a supply chain risk in March.
- The Fallout: The ruling prohibits the U.S. military from utilizing Anthropic's models and forbids defense contractors from incorporating them into agency projects.
- Company Response: Anthropic maintains its confidence in its legal standing and is exploring further appeals.
The Judicial Decision
In a split decision delivered on Friday, a panel of the U.S. Court of Appeals for the District of Columbia rejected Anthropic's claims that the ban on its Claude AI models was unconstitutional, unauthorized, or arbitrary.
"The Department had ample support for its conclusion that the continued integration of Claude into the Department's information systems... presented a statutorily covered national-security risk," wrote Judge Gregory Katsas in the majority opinion.
Judge Neomi Rao joined the majority, while Judge Karen LeCraft Henderson (appointed by George H.W. Bush) dissented.
Legal Status Comparison
The legal battle has been complex because the DOD utilized two separate designations to justify the risk label, leading to parallel litigation in different jurisdictions:
| Court Location | Ruling | Status of Designation |
|---|---|---|
| San Francisco | Ruled the designation was illegal | |
| Washington, D.C. | Upheld the designation |
Political Friction and Public Spats
The relationship between Anthropic and the Trump administration has been characterized by extreme tension. President Trump has frequently targeted CEO Dario Amodei via social media, particularly after Amodei advocated for a general industry-wide deceleration of AI development.
The friction reached a peak recently when Amodei was notably absent from the White House state dinner hosted for Chinese President Xi Jinping.
Truth Social Commentary
On Monday, President Trump posted the following:
The Trump Administration has stopped AI people from doing bad, or potentially bad, things, like Dario (Anthropic!), who is now pretending to be a perfect little angel - and we will continue to do so!
The Road to the Blacklist: A Timeline
The conflict is the result of a rapid deterioration in the partnership between the AI developer and the military.
The Core Dispute
The breakdown occurred during discussions regarding the deployment of Claude on the GenAI.mil platform. The DOD sought total access to the models, whereas Anthropic insisted on guarantees that their technology would not be used in ways that violated their safety principles.
Current Status and Next Steps
While the court has ruled against the company, the decision will not take immediate effect. The appellate panel has granted a stay to allow Anthropic to:
- Petition the current panel for a rehearing.
- Seek an en banc rehearing (a review by all judges on the D.C. Circuit).
Contract Status: Active Status: Terminated/Blacklisted
Official Statement from Anthropic: "We respectfully disagree with the court's decision... We remain confident in our position and are considering all options, including further review."
Visual Documentation
Aerial view of the Pentagon in Arlington, Virginia.
CEOs of major AI firms, including Anthropic, briefing the UN Security Council.