On Wednesday, a federal appeals court in Washington declined to temporarily block the Pentagon's decision to label Anthropic a national security risk.

Appeals Court Sides With Pentagon — For Now

The development handed the Donald Trump administration a key interim victory in a closely watched legal fight over artificial intelligence and military use, Reuters reported.

The ruling allows the designation to remain in effect while litigation continues, though it does not resolve the case on its merits.

Why The Pentagon Blacklisted Anthropic

Defense Secretary Pete Hegseth classified Anthropic as a supply-chain risk after the company refused to loosen safeguards on its Claude chatbot for uses such as surveillance or autonomous weapons.

The government argues that those restrictions could create uncertainty in military operations and potentially hinder system reliability during critical missions.

Anthropic Pushes Back, Cites Constitutional Violations

Anthropic has challenged the move in two separate lawsuits, alleging the government retaliated against its stance on AI safety.

The company claims the designation violates its First Amendment rights and was imposed without due process, breaching Fifth Amendment protections.

It also argues that the decision lacks a factual basis and contradicts prior positive assessments of its technology by the military.

In a statement to Benzinga following the Wednesday decision, the company said it remains “confident the courts will ultimately agree that these supply chain designations were unlawful.”

Anthropic also pointed to key portions of the court's order, noting that judges acknowledged the case raises "novel and difficult questions," including how supply-chain risk is defined and what constitutes an urgent national security interest.

The company further highlighted that the court recognized its claims as substantial and said it is likely to face some irreparable harm while the case proceeds, warranting an expedited review.

Conflicting Court Signals Raise Stakes

The Washington ruling contrasts with a separate decision by a California federal judge, who blocked a related Pentagon order, citing concerns it may have been unlawful retaliation.

Anthropic lists Amazon.com, Inc. (NASDAQ:AMZN) and Alphabet Inc.'s (NASDAQ:GOOG) (NASDAQ:GOOGL) Google among its key strategic partners.

Last year, Microsoft Corp (NASDAQ:MSFT) and Nvidia Corp (NASDAQ:NVDA) also committed significant funding, with Nvidia pledging up to $10 billion and Microsoft up to $5 billion.

In February 2026, Anthropic closed a $30 billion Series G funding round. The deal valued the company at $380 billion post-money.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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