Anthropic seeks rehearing of Pentagon security risk ruling

A federal appeals court in September upheld the designation in a 2-1 decision, agreeing with the Pentagon that the firm's safety restrictions could compromise military operations. The Pentagon's decision has cost Anthropic billions of dollars in lost business, according to the company.

The court's majority stated that the Pentagon acted reasonably after Anthropic refused to allow its AI to be used in autonomous weapons or mass surveillance. The court also rejected Anthropic's claim that it faced retaliation from the Defense Department over its views on AI safety.

In its petition on Tuesday to the U.S. Court of Appeals in Washington, D.C., for a rehearing, Anthropic argued that the panel majority misinterpreted and transformed a federal law "aimed at hostile foreign actors into one that presumptively reaches every government contractor." The company asserted that the court allowed the Pentagon to take action without a pre-designation process and despite evidence that the designation was retaliation for Anthropic's statements on AI safety.

Separately, a federal judge in California struck down a parallel designation under a different law in August. Anthropic CEO Dario Amodei has advocated for regulation covering all U.S. frontier AI companies, contrasting with the Trump administration's pro-growth approach.