Yesterday, U.S. District Judge Rita F. Lin ruled that the Trump administration’s blacklisting of Anthropic was illegal. The court found the government’s actions violated the First Amendment, the Due Process Clause, and the Administrative Procedure Act. The actions in question, taken on February 27 and March 3, designated Anthropic a supply chain risk to national security, ordered every federal agency to permanently stop using Anthropic’s products, and banned all defense contractors from doing any business with the company, even business unrelated to the military.
The fight began over contract terms. Anthropic publicly refused the Department of War’s demands about how its models could be used in military and surveillance contexts; the court called the private negotiations “staid and respectful” and noted Anthropic offered an orderly transition to another vendor. Then came the blacklist.
The administrative record the government filed to justify it was, in the court’s words, “slim”: a four-page memorandum written after two of the three challenged actions. The government abandoned its original theory – that Anthropic held backdoor access to deployed systems – because Anthropic “undisputedly lacks any such access.” It also conceded that Anthropic’s technology is no riskier than any other black-box AI model. What remained was “trust,” grounded in Anthropic’s “increasingly hostile manner through the press.”
Days before the blacklisting, Secretary Hegseth proposed applying the Defense Production Act to Anthropic, which would have treated the company as essential to national security. The Department was still pursuing an Anthropic contract (“we are very close here”), and the government was still discussing deployments of Anthropic’s Mythos model in sensitive contexts.
Hegseth called Anthropic’s public stance “a master class in arrogance.” Judge Lin wrote that broadcasting the punishment on social media before the formal process even began “makes little sense except as an attempt to swiftly make a public example of Anthropic for daring to criticize the Administration,” and that “the empty invocation of national security is not a blank check to punish and retaliate against government critics.”
This fight was a bit of a sideshow. The real issue is that the most capable frontier models are simply not available to the general public (and likely never will be again). Being model-agnostic is the only viable AI strategy.
Every company needs a Claw strategy. Do you have one?
Author’s note: This is not a sponsored post. I am the author of this article and it expresses my own opinions. I am not, nor is my company, receiving compensation for it. This work was created with the assistance of various generative AI models.
About Shelly Palmer
Shelly Palmer is the Professor of Advanced Media in Residence at Syracuse University’s S.I. Newhouse School of Public Communications and CEO of The Palmer Group, a consulting practice that helps Fortune 500 companies with technology, media and marketing. Named LinkedIn’s “Top Voice in Technology,” he covers tech and business for Good Day New York, is a regular commentator on CNN and writes a popular daily business blog. He's a bestselling author, and the creator of the popular, free online course, Generative AI for Execs. Follow @shellypalmer or visit shellypalmer.com.