Anthropic has filed a lawsuit seeking to block the United States Department of Defense from placing it on a national security blacklist, escalating a dispute over restrictions on the military use of its artificial intelligence technology.

In a complaint filed in federal court in California, the AI company said the designation was unlawful and violated its constitutional rights, including protections for free speech and due process.

“These actions are unprecedented and unlawful,” Anthropic said in the filing. “The Constitution does not allow the government to wield its power to punish a company for its protected speech.”

The dispute centres on Anthropic’s refusal to remove safeguards preventing its AI models from being used for fully autonomous weapons or domestic surveillance.

The decision to label the company a supply-chain risk was approved by U.S. Defense Secretary Pete Hegseth after months of negotiations between the company and the Pentagon.

The move threatens Anthropic’s business with government agencies and could influence how other AI companies negotiate limits on military use of their technology.

Chief executive Dario Amodei has said the company is not opposed to AI-driven weapons in principle but believes current systems are not reliable enough for autonomous military operations.

Executives warned in court filings that the designation could cost the company billions of dollars in future revenue and damage its reputation with enterprise clients.

Some customers have already switched to rival AI models, while negotiations with financial institutions worth about $180 million have reportedly been disrupted.

Meanwhile, a group of engineers from OpenAI and Google DeepMind have filed an amicus brief supporting Anthropic, arguing that punishing companies for imposing safety restrictions could discourage open debate about the risks and benefits of artificial intelligence.

The dispute has become a major test of how much control governments should have over AI technology developed by private companies, particularly when national security interests are involved.