The U.S. Department of War has officially designated Dario Amodei's AI company Anthropic a "supply chain risk to national security," banning the Pentagon and its contractors from using Anthropic's Claude AI systems for defense-related work. The company says it will fight the move in court.

The Pentagon confirmed the designation on Thursday (March 5), saying it was effective immediately. A senior Defense Department official stated: "This has been about one fundamental principle: the military being able to use technology for all lawful purposes. The military will not allow a vendor to insert itself into the chain of command by restricting the lawful use of a critical capability and put our warfighters at risk."

The company has six months to wind down its defense-related business under the terms Secretary of War Pete Hegseth announced.

Amodei fired back in a statement posted to Anthropic's website Thursday night, saying: "We do not believe this action is legally sound, and we see no choice but to challenge it in court." He added: "Anthropic has much more in common with the Department of War than we have differences."

The conflict stems from months of tense contract negotiations between Anthropic and the Pentagon. The military wanted broad, unrestricted use of Anthropic's AI models for "any lawful use," but Amodei held firm on two specific restrictions: he did not want Claude used to power fully autonomous lethal weapons or to conduct mass domestic surveillance of Americans.

Defense contractor Lockheed Martin said it would follow the Pentagon's direction and seek other AI providers, though it noted it was "not dependent on any single LLM vendor." Microsoft said its lawyers reviewed the rule and concluded it "can continue to work with Anthropic on non-defense related projects." Amodei confirmed the ban applies only to Claude's use as a "direct part of" military contracts, not to non-defense business.

Despite the military contract loss, Anthropic saw a surge of public support. Over one million people per day signed up for Claude this week, pushing it past OpenAI's ChatGPT and Google's Gemini as the top AI app in more than 20 countries on Apple's App Store.

Meanwhile, Sam Altman's OpenAI quickly moved to fill the void, announcing a new deal with the Pentagon to use ChatGPT in classified military settings. Elon Musk's xAI also secured a Pentagon deal last week to use its Grok AI systems on classified networks.

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