A federal judge has issued a temporary injunction, stopping the Trump administration from designating AI company Anthropic as a national security risk and barring it from federal contracts. U.S. District Judge Rita Lin ruled on Thursday that the administration's aggressive move appeared legally unsound and threatened to severely damage the business.

The conflict began when the Department of Defense demanded unrestricted rights to use Anthropic's Claude AI system. Anthropic refused, seeking to bar military applications for mass domestic surveillance or fully autonomous weapons. Following this refusal, President Trump and Defense Secretary Pete Hegseth moved to label the company a "supply chain risk."

In her ruling, Judge Lin sharply criticized the government's approach. "Nothing in the governing statute supports the Orwellian notion that an American company may be branded a potential adversary and saboteur of the US for expressing disagreement with the government," she wrote. She suggested the measures seemed more about punishment than genuine security, noting the Pentagon could simply choose not to use Claude if it had concerns.

Anthropic, which sued earlier this month calling the designation an unlawful attack on free speech, welcomed the decision. The company stated its focus remains on collaborating with the government to develop safe and reliable AI. Judge Lin delayed the injunction's effect for one week to allow the Pentagon to appeal. The White House and Department of Defense have not yet commented.

Source: CNET