Appeals Ct Panel Upholds Ban on One AI Company as Security Risk

Abuse of Power

May 16

NEWS & RESEARCH

A majority of a federal appeals court panel fhas upheld the Trump administration’s ban on the AI company Anthropic. The two judges of the District of Columbia Circuit voting to uphold the ban were Trump appointees; the dissenter was appointed by George H.W. Bush. The majority concluded that what they referred to as the “Department of War” properly determined that Anthropic was a "supply chain risk" after the company refused to remove mild safety guardrails on military applications. While Anthropic has not opposed current U.S. military operations in Venezuela and Iran, it sought to prevent future use of its technology in lethal autonomous weapons and expanded mass surveillance. In response, President Trump and Defense Secretary Pete Hegseth condemned the restrictions as left-wing "virtue signaling" and demanded Anthropic permit "all lawful use" of its AI. The appeals court

SOURCES: WIRED | The Guardian | Anthropic PBC v. US Dept. of War

ANALYSIS & OPINION

Dissenting from the appeals court panel’s majority decision Judge Henderson wrote: “[S]uppose the Secretary [of Defnese] tells Anthropic’s presumed replacement to change its AI-use policies to permit any ‘functions that the Department deems necessary’ or it will share the same fate as Anthropic. According to today’s decision, that contractor will have a choice: Agree to the Secretary’s demands or risk being designated a national security threat under [the Federal Acquisition Supply Chain Security Act].” Former White House senior AI policy adviser Dean Ball criticized the supply chain risk designation—which bars any company doing business with the military from working with Anthropic—as essentially sanctioning an American company. Previously, a federal district court judge remarked that the Pentagon appeared to be "attempting to cripple" Anthropic over a contract dispute.

SOURCES: WIRED | The Guardian | CNBC | Anthropic PBC v. US Dept. of War

HOW TO FIX IT

Federal action:

Support demands for answers from the DOD on its reasons for the supply chain designation, as well as answers from AI companies on the terms of their agreements with the DOD that could enable mass surveillance.
Support demands for answers from the DOD on its reasons for the supply chain designation, as well as answers from AI companies on the terms of their agreements with the DOD that could enable mass surveillance.
Pass H.R.7816, the Protect Liberty and End Warrantless Surveillance Act of 2026, which contains provisions to prohibit law enforcement and intelligence agencies from purchasing sensitive protected information from third-party sellers.
Investigate “the DOD’s use of autonomous and semi-autonomous weapons systems.”
Adapt laws “governing the collection, analysis, and retention of private communications and other data” to “address the privacy risks of training, developing, and using AI in national security systems.”

Legislation: H.R.7816 - Protect Liberty and End Warrantless Surveillance Act of 2026