DoD designates Anthropic as supply-chain risk; Anthropic sues DoD.
The U.S. Department of Defense has designated artificial-intelligence company Anthropic as a supply-chain risk, a move that has sparked legal action. DoD’s chief technology officer, Emil Michael, told CNBC that there is no possibility the department will settle with Anthropic over the designation.
Michael said Anthropic’s leadership had sought to obtain and share confidential information, and that confidential messages were circulated among its executives. He argued that Anthropic’s internal AI operating guidelines—referred to in the government process as its Constitution and its core “soul” and policy preferences—are embedded in its models, which the department says could contaminate the defense supply chain.
He acknowledged that genuine supply-chain risk exists but suggested it cannot be eliminated quickly because the risk is deeply ingrained in the systems. He described the risk as real but something that takes time to address.
According to Michael, the department chose Anthropic’s Claude model as a preferred option because of an executive order from the Biden administration, describing Anthropic’s inclusion as part of a presidential-era policy legacy. He framed the designation as a continuation of roles established by the prior administration.
Michael also pushed back on characterizations that the DoD’s action is punitive and dismissed rumors that the government is pressuring companies to stop using Anthropic products. He said the administration’s aim is not to cripple the company, and he expressed wishes for Anthropic’s ongoing commercial success.
Reuters reports that Anthropic responded by suing the DoD and seeking a temporary injunction in a Washington, D.C. appeals court to halt the supply-chain designation. Anthropic argues the move could cause irreparable harm to the company and billions of dollars in revenue losses.
Separately, Palantir Technologies CEO Alex Karp told CNBC that Claude is still in use at Palantir, highlighting that some U.S. government-affiliated supply chains still rely on Anthropic’s technology despite the dispute.
Why this matters for the United States: the fight over Anthropic underscores how the DoD and other federal agencies are approaching AI governance and vendor risk in defense and critical infrastructure. The outcome could influence whether major AI firms can participate in federal programs, affect procurement and cloud-service choices, and shape the broader policy environment for U.S. tech firms competing for government contracts and partnerships.