qwant news | D.C. Circuit Declines to Stay Department of War's "Supply-Chain Risk" Designation of Claude
The D.C. Circuit, in an order issued on AugustâŻ4,âŻ2026, denied Anthropic PBCâs request for a stay pending review of the Department of Warâs âsupplyâchain riskâ designation of its AI model Claude. The department, after Claudeâs refusal to be used for mass domestic surveillance or lethal autonomous warfare, concluded that procuring Anthropicâs AI posed a nationalâsecurity risk under 41âŻU.S.C.âŻÂ§âŻ4713, canceled its contracts, and began removing Claude from its systems. Anthropic argued that the designation was unlawful, unconstitutional, and arbitrary, and sought a stay to prevent what it claimed would be irreparable financial harm and a FifthâAmendmentâtype preâdeprivation hearing.
The court applied the fourâfactor test for an extraordinary stay: Anthropic failed to make a strong showing of likely success on the merits; while it may suffer financial loss, the harm was not shown to be truly irreparable, and the companyâs constitutional claims were largely financial in nature. Conversely, granting a stay would force the military to continue using an unwanted vendor during an active conflict, impairing the Departmentâs ability to obtain AI models free of usageâpolicy constraints that the government deems essential for lawful military operations. The judges emphasized the weight of governmental and public interests in nationalâsecurity decisions and declined to intervene in the Departmentâs procurement choices.
Although the stay was denied, the court recognized that Anthropicâs challenges merit expedited consideration and set an accelerated briefing schedule with oral argument slated for MayâŻ19. The parties must now address jurisdiction under 41âŻU.S.C.âŻÂ§âŻ1327, whether the Departmentâs actions constitute a âcovered procurement action,â and how Anthropic might affect its AI models before or after delivery to the Department. This decision underscores the judiciaryâs reluctance to block military procurement decisions, even as the parallel case in the Northern District of California proceeds.
Read more: https://reason.com/volokh/2026/04/08/d-c-circuit-declines-to-stay-department-of-wars-supply-chain-risk-designation-of-claude/
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