 [Yahoo Finance] Oops! Virtue signalled your company into the hole
(Bloomberg) -- Anthropic PBC vowed to legally contest a Pentagon decision to declare the company a threat to the US supply chain under an authority normally reserved for foreign adversaries, escalating a showdown with the Trump administration over artificial intelligence safeguards.
"We do not believe this action is legally sound, and we see no choice but to challenge it in court," Chief Executive Officer Dario Amodei said in a blog post Thursday, hours after Bloomberg News reported on the Pentagon finding.
Defense officials had notified the company on Wednesday of the supply-chain designation, Amodei said in his post. The move puts at risk the firm’s $200 million contract to provide the Pentagon with classified AI tools, and could bar Anthropic from partnering with other companies on their defense work.
The Pentagon has formally notified Anthropic PBC that it has determined the company and its products pose a risk to the US supply chain.
The decision culminated weeks of increasingly tense negotiations between Amodei and government officials over the US military’s access to Anthropic’s technology. Talks broke down last week after the company demanded assurances that its AI wouldn’t be used for mass surveillance of Americans or autonomous weapons deployment, prompting Defense Secretary Pete Hegseth to threaten the company with the supply-chain risk designation.
Though Anthropic still plans to challenge the move, Amodei said that the statute invoked — section 3252 of the US law governing the armed forces — is narrowly tailored enough to keep it from affecting other Anthropic business that’s unrelated to specific Pentagon contracts.
That offers some reassurance for customers and investors who feared the company could lose the ability to do any business with companies that worked with the Pentagon. A Microsoft Corp. spokesperson said Thursday the company had concluded that it can continue to work with Anthropic on non-defense projects.
Even so, the designation means the company has to stop working with Palantir Technologies Inc., another military contractor. That includes Palantir’s use of Anthropic’s Claude in the digital mission control platform known as Maven Smart System, which has been deployed in the US military’s Iran campaign.
The Pentagon’s decision also threatens to slow broader efforts to accelerate adoption of AI across the US military. Until recently, Anthropic provided the only AI system that could operate in the Pentagon’s classified cloud, and its Claude Gov tool has become a favored option among defense personnel for its ease of use.
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