ISLAMABAD: A US appeals court has refused to suspend the Pentagon’s decision to classify AI firm Anthropic as a supply chain risk, but has directed that the company’s legal case against the Department of War be handled on an expedited basis.
In its ruling, the three-judge panel said the potential financial impact on a single private company was limited compared to the broader implications of judicial interference in how the military secures critical AI technologies during an active conflict.
The dispute arose after the Pentagon designated Anthropic — the developer of the Claude AI model — as a national security supply chain risk, a classification typically applied to entities linked to hostile foreign states.
Anthropic challenged the move in court and sought to block the designation, arguing that it was unjustified. While the appeals court declined to pause the measure, it acknowledged that the company had raised significant legal concerns and warranted a faster resolution of the case.
Lacking proper justification
In a separate ruling, a federal judge in California temporarily halted the sanctions, stating that the government’s actions were likely unlawful and lacked proper justification. The judge indicated that the designation appeared arbitrary and inconsistent with legal standards.
The conflict began earlier this year after Anthropic expressed concerns over the potential military use of its technology, particularly for mass surveillance and autonomous weapons systems.
A spokesperson for the company welcomed the expedited proceedings, saying Anthropic remained confident that the courts would ultimately rule in its favour. The company also stressed its willingness to continue engaging constructively with the government to ensure safe and responsible use of artificial intelligence.
The case has drawn attention across the technology sector, with many industry players backing Anthropic’s position amid growing debate over the role of AI in defence and national security.
