During a Thursday hearing, a judge ruled that the Trump administration had not provided sufficient evidence to label Anthropic's technology as a supply-chain risk and ban federal agencies from using it. The dispute centers on stalled contract negotiations between Anthropic and the Department of Defense, with Anthropic objecting to its AI being used for mass surveillance or lethal weapons.

The Pentagon argued that private companies shouldn’t dictate military technology usage, though experts dismissed their claims of potential tech tampering as unfounded. Judge Rita Lin called the ban logic 'troubling', warning it could set a precedent for retaliating against contractors who disagree with government policies.

This ruling is part of two lawsuits filed by Anthropic in March, challenging both the ban and the risk designation. Lin’s temporary block on the ban is now under review, as she considers making it permanent.