On August 28, Federal Judge Rita F. Lin overturned the Pentagon’s ban on Anthropic, ruling it constituted illegal retaliation violating the First Amendment. The Defense Department, which had designated the company as a supply chain risk under 10 U.S.C. § 3252, must withdraw its designation and repeal all associated directives. This 59-page decision sets a major legal precedent for technology companies contracting with Washington, durably limiting the Pentagon’s discretionary authority to exclude suppliers. For Anthropic, whose annualized revenue reached $65 billion by late July, the national security risk label attached to the company weeks before its IPO posed the greatest threat, not the value of lost Pentagon contracts.
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