Anthropic to challenge DOD’s supply-chain label in court

Dario Amodei said Thursday that Anthropic plans to challenge the Department of Defense’s decision to label the AI firm a supply-chain risk in court, a designation he has called “legally unsound.”

The statement comes a number of hours after the DOD officially designated Anthropic a supply-chain risk following a weeks-long dispute over how much control the military must have over AI systems. A supply-chain risk designation can bar an organization from working with the Pentagon and its contractors. Amodei drew a firm line that Anthropic’s AI won’t be used for mass surveillance of Americans or for fully autonomous weapons, however the Pentagon believed it must have unrestricted access for “all lawful purposes.”

In his statement, Amodei said the overwhelming majority of Anthropic’s customers are unaffected by the supply-chain risk designation.

“With respect to our customers, it plainly applies only to the usage of Claude by customers as a direct a part of contracts with the Department of War, not all use of Claude by customers who’ve such contracts,” he said.

As a preview of what Anthropic will likely argue in court, Amodei said the Department’s letter labeling the firm a supply-chain risk is narrow in scope.

“It exists to guard the federal government reasonably than to punish a supplier; actually, the law requires the Secretary of War to make use of the least restrictive means vital to perform the goal of protecting the provision chain,” Amodei said. “Even for Department of War contractors, the provision chain risk designation doesn’t (and might’t) limit uses of Claude or business relationships with Anthropic if those are unrelated to their specific Department of War contracts.”

Amodei reiterated that Anthropic had been having productive conversations with the DOD over the past several days, conversations that some suspect got derailed when an internal memo he sent to staff was leaked. In it, Amodei characterised rival OpenAI’s dealings with the Department of Defense as “safety theater.”

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OpenAI has signed a deal to work with the DOD in Anthropic’s place, a move that has sparked backlash amongst OpenAI staff.

Amodei apologized for the leak in his Thursday statement, claiming that the corporate didn’t intentionally share the memo or direct anyone else to accomplish that. “It will not be in our interest to escalate the situation,” he said.

Amodei said the memo was written inside “a number of hours” of a series of announcements, including a presidential Truth Social post saying Anthropic can be faraway from federal systems, then Defense Secretary Pete Hegseth’s supply-chain risk designation, and eventually the Pentagon’s deal announcement with OpenAI. He apologized for the tone, calling it “a difficult day for the corporate” and said the memo didn’t reflect his “careful or considered views.” Written six days ago, he added, it’s now an “out-of-date assessment.”

He finished by saying Anthropic’s top priority is to make sure American soldiers and national security experts maintain access to necessary tools in the midst of ongoing major combat operations. Anthropic is currently supporting among the U.S.’s operations in Iran, and Amodei said the corporate would proceed to offer its models to the DOD at “nominal cost” for “so long as vital to make that transition.”

Anthropic could challenge the designation in federal court, likely in Washington, however the law behind the choice makes it harder to contest since it limits the standard ways firms can challenge government procurement decisions and provides the Pentagon broad discretion on national security matters.

Or as Dean Ball — a former Trump-era White House adviser on AI who has spoken out against Hegseth’s treatment of Anthropic — put it: “Courts are pretty reluctant to second-guess the federal government on what’s and will not be a national security issue … There’s a really high bar that one must clear with a view to do this. But it surely’s not not possible.”

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