The U.S. Court of Appeals for the District of Columbia Circuit rejected Anthropic's emergency motion to suspend the Department of Defense's designation of it as a national security supply chain risk. A three-judge panel ruled Wednesday that the government's interests in controlling AI technology procurement during active military conflict take precedence over potential financial or reputational damage to Anthropic. The dispute stems from a July 2025 contract between Anthropic and the Pentagon to deploy its AI model, Claude, on classified networks. Negotiations broke down in February, with the government demanding that Anthropic allow the military unrestricted use of Claude, while Anthropic maintains that its technology should not be used for lethal autonomous weapons or mass domestic surveillance of U.S. citizens. President Trump ordered all federal agencies to cease using Anthropic products in late February, prompting Anthropic to sue the Trump administration in March. A preliminary injunction in the Northern District of California temporarily halted Trump's order. However, due to federal procurement laws, Anthropic must file separate lawsuits in both the California District Court and the District of Columbia Circuit. The appeals court ruling acknowledged that Anthropic could have suffered some degree of irreparable harm in the absence of a stay of proceedings and stated that the case should be expedited. Acting U.S. Attorney General Todd Blanche called the ruling "a major victory for military readiness."