On August 27, 2026, Judge Rita F. Lin of the Northern District of California issued a 59-page opinion on cross motions for summary judgment in Anthropic PBC v. U.S. Department of War (26-cv-01996-RFL), followed by a four-page Order of Final Relief and a judgment that terminated the case. The dispute began in February 2026, when President Trump directed every federal agency to stop using Anthropic’s products, Secretary of War Pete Hegseth barred defense contractors from any commercial dealings with the company, and the Department designated Anthropic a supply chain risk to national security. Anthropic had refused to drop two usage restrictions on Claude covering fully autonomous lethal weapons and mass surveillance of Americans.
The court found the administrative record thin: a single four-page memorandum, post-dating two of the three challenged actions, supplied the entire government rationale, and the government had abandoned its central claim that Anthropic retained backdoor access to deployed models. What remained was “trust,” resting on Anthropic’s “increasingly hostile manner through the press.” The opinion holds that punishing a company for publicly criticizing the government’s contracting position is First Amendment retaliation, that the actions deprived Anthropic of protected liberty interests without pre-deprivation notice or a hearing under the Fifth Amendment, and that the designation was arbitrary, capricious, and beyond the authority granted by 10 U.S.C. Section 3252.
The relief order declares the challenged actions unlawful, permanently enjoins the participating defendants from enforcing them, vacates and sets aside the supply chain designation and the contractor boycott order under 5 U.S.C. Section 706(2), and vacates the implementing actions taken by the Department of War, State, Treasury, OPM, NRC, DHS, Energy, FHFA, and GSA. Anthropic lost on its ultra vires count and as to five non-participating agencies. Critically, the order preserves the government’s ordinary discretion: it does not require the Department of War to use Claude and does not stop it from switching vendors. For AI vendors selling into government, the ruling draws a line between a buyer’s freedom to choose a supplier and a regulator’s power to blacklist one for speech, and it is the first time the supply chain risk label, built for foreign saboteurs, has been tested against a domestic company.