Appeals court sides with Trump admin in Anthropic blacklisting

Appeals court sides with Pentagon on Anthropic blacklisting

The U.S. Court of Appeals for the D.C. Circuit sided with the Trump administration in its blacklisting of the artificial intelligence firm Anthropic , allowing the Pentagon to label the AI firm a supply chain risk.

The 2-1 ruling , issued Friday, rejected Anthropic’s challenge of the designation, finding the Department of Defense had “ample support” for its belief that the continued use of Anthropic’s Claude models by the agency or its contractors presented a national security risk.

The three-judge panel in D.C. specifically took up the question of whether the Pentagon and Secretary Pete Hegseth had the legal authority under a statute of the Federal Acquisition Supply Chain Security Act (FASCA) to declare Anthropic a supply chain risk.

“The Department reasonably feared that Anthropic might manipulate Claude’s design to prevent it from performing national-security functions that the Department deems contractually authorized and necessary,” Circuit Judge Gregory Kastas wrote for the majority.

Anthropic sued the Trump administration in March, challenging both the Pentagon’s designation — typically reserved for foreign adversaries — and President Trump’s directive for civilian agencies to stop using Anthropic’s products after negotiations fell apart over safety guardrails earlier this year.

Anthropic requested its technology not be used in fully autonomous lethal weapons or for the mass surveillance of Americans, while the Pentagon insisted it be allowed to use Anthropic’s Claude for “all lawful uses.”

“Because Anthropic was willing and able to enforce contractual restrictions through model training, the Department reasonably worried that ‘critical defense system’ supported by Claude might ‘fail to engage’ as the Department would expect,” Kastas wrote.

Welcome to The Hill’s Technology newsletter , we’re Julia Shapero and Miranda Nazzaro — tracking the latest moves from Capitol Hill to Silicon Valley.

Did someone forward you this newsletter? Subscribe here.

How policy will be impacting the tech sector now and in the future:

Appeals court rules against Kalshi, says prediction markets can be regulated like gambling

The 6th U.S. Circuit Court of Appeals ruled against the prediction market Kalshi Friday, determining states can regulate prediction market platforms like gambling in the latest blow to the industry. In a unanimous ruling, the three-judge panel sided with Ohio and Tennessee, finding Kalshi did not show its sports-event contracts are “swaps” that typically fall under the jurisdiction of the Commodity Futures Trading …

President Trump said Friday he is ruling out Treasury Secretary Scott Bessent to serve as his artificial intelligence czar amid speculation the Cabinet member was under consideration. Trump, in a Truth Social post, said Bessent will not be the “Super Intelligence (SI) Czar,” referring to his proposed rebranding of AI, because he “doesn’t want to.” “Number Two, he’s doing such a great …

Trump: Xi ‘seemed to like’ calling AI ‘super intelligence’

President Trump said on Friday that Chinese President Xi Jinping appeared to like referring to artificial intelligence as “super intelligence” days after Trump announced the U.S. would be using the new name in official documents and communications. Trump made the observation in a Truth Social post in which he referred to his meeting with the Chinese leader as “very productive.” “Tremendous things will be happening. Like almost …

News we’ve flagged from t he intersection of tech and other topics:

ShinyHunters hackers say they stole psychiatric, medical records of FBI staff ( T he Hill )

AI’s never-before-seen capital grab ( Axios )

Branch out with other reads on The Hill:

For Insiders — On the Ballot: 10 GOP House seats most likely to flip in November

With less than six weeks to go until November’s elections, Republicans are on defense as the midterm landscape looks increasingly favorable for Democrats.

Opinions related to tech submitted to The Hill:

Check out The Hill’s Technology page for the latest coverage.

400 N Capitol Street NW Suite 650, Washington, DC 20001