US appeals court upholds Pentagon's blacklisting of Anthropic from military contracts

A federal appeals court on Friday declined to block a Defense Department order blacklisting Anthropic from military contracts and deeming the AI startup a national security risk.

The ruling from the US Court of Appeals for the District of Columbia Circuit came in a lawsuit by Anthropic challenging its designation by the Pentagon as a national security supply chain risk, which the startup says has cost it billions of dollars in lost business and damaged its reputation ahead of a highly anticipated initial public offering.

Anthropic said in a statement that it respectfully disagrees with the decision but remains confident in its position and is considering its options, including further judicial review.

A federal judge in San Francisco last month struck down a parallel designation under a different law, finding the administration had unlawfully retaliated against Anthropic for its views on AI safety.