A leading artificial intelligence company has been labeled a “supply-chain risk,” and businesses that rely on its technology are scrambling to understand how this could affect their operations.
In a social media post, US Secretary of Defense Pete Hegseth broadly stated that effective immediately, no contractor, supplier, or partner doing business with US military may conduct any commercial activity with Anthropic. The company responded that the Secretary does not have the statutory authority to impose said restrictions and that it would challenge any supply-chain risk designation in court.
Alexander Major, Co-Chair of McCarter & English’s Government Contracts & Global Trade Practice told WIRED that Hegseth’s announcement does not currently appear grounded in any identifiable law. As a result, businesses will need to keep a close watch for more formal regulatory guidance.