For Anthropic, the stakes could be significant; the “supply chain risk” label could affect the company’s contracts with the vast ecosystem of private-sector firms that do business with the military. “Instead, Anthropic is asking only that it not be punished on its way out the door.”The Pentagon “misinterpreted the statute and violated the necessary procedures” when it labeled Anthropic a “supply chain risk,” they also wrote. The Defense Department designated Anthropic a “supply chain risk” earlier this month after negotiations over the use of the company’s AI models in classified systems broke down. The “supply chain risk” label is usually given to companies associated with foreign adversaries and has never been given to an American company in modern times. In addition to the ‘supply chain risk’ designation, President Donald Trump ordered all federal agencies to stop using Claude.

Source: CNN March 18, 2026 07:48 UTC