Defense Secretary Pete Hegseth delivered an ultimatum to Anthropic this week, warning that the Pentagon would cut ties with the company if it did not agree to open its artificial intelligence technology for unrestricted military use by Friday. The threat, reported by the Associated Press, came alongside additional warnings from Defense officials in the Trump administration about possible government leverage over the company and its technology.
The administration also signaled it could treat Anthropic as a supply-chain risk and, if it chose, invoke the Defense Production Act, a law first signed by President Harry S. Truman in 1950, to give the military more sweeping authority over products needed for national defense. In the account, some experts said using the law this way could trigger legal challenges, particularly because the move would apply a national-security tool to how an AI vendor sets safety and contract terms.
To understand the dispute, federal officials’ plan turns on what the Defense Production Act (DPA) does. The AP report described the DPA as a set of powers that allow the federal government to direct private companies to prioritize what the government determines is necessary for national defense, including through requiring prioritization of certain government contracts and orders and through incentives such as loans intended to increase production of critical goods.
Joel Dodge, an attorney and director of industrial policy and economic security at the Vanderbilt Policy Accelerator, said the Defense Production Act is “one of the government’s most powerful and adaptable industrial policy tools.” In his assessment, compelling a company to produce a product it deems unsafe—or dictating the company’s terms of service—would mark a significant departure from prior uses of the law, which he characterized as lacking precedent for that kind of compulsion.
The AP report also laid out how the DPA has been used in earlier crises, including in the COVID-19 pandemic. It said Trump in his first term and former President Joe Biden invoked the DPA to boost supplies needed to fight the pandemic, and it noted that in 2022 during a baby formula shortage, Biden used the law to speed formula production and authorize flights to import supply from overseas.
Beyond those public health actions, the report described other DPA applications in energy and disaster contexts. It said administrations of Presidents Bill Clinton and George W. Bush used the law decades ago to ensure electricity and natural gas shippers continued supplying California utilities amid an energy crisis, and it said the law was used after Hurricane Maria struck Puerto Rico in 2017 to prioritize contracts for food, bottled water, manufactured housing units, and electrical restoration.
The Anthropic ultimatum adds a new complication because the company had repeatedly said it would not supply its technology to a new U.S. military internal network. The AP report said Anthropic CEO Dario Amodei has described ethical concerns about how the technology might be used, including risks tied to fully autonomous armed drones and AI-assisted mass surveillance that could track dissent. The Pentagon, the report said, has maintained it has no interest in using AI for mass surveillance or to develop autonomous weapons that operate without human involvement.
If Defense officials try to invoke the DPA in Anthropic’s case, experts warned the government might seek changes that extend beyond simple delivery of an existing product. The AP report said that could mean forcing the company to adapt its model to Pentagon needs “without built-in safety limits,” or removing certain ethical restrictions from contract language, depending on how officials shape their requests.
Charlie Bullock, a senior research fellow at the Institute for Law & AI, said in the AP account that the government may try to overrule company pushback if the parties do not reach agreement. Bullock added that if neither side backs down, it would be “realistic” for litigation to follow between Anthropic and the government, according to the report.
In a separate development cited by the AP, Defense officials appeared to narrow the options by tying the ultimatum to an explicit deadline. Chief Pentagon spokesperson Sean Parnell wrote on social media that if Anthropic did not agree to cooperate by 5:01 p.m. ET on Friday, “we will terminate our partnership with Anthropic and deem them a supply chain risk.” In the same post, Parnell added, “We will not let ANY company dictate the terms regarding how we make operational decisions,” according to the AP report.
Dodge said the administration was counting on “a lot of forces” to get Anthropic to bend before the deadline. He also warned that if Anthropic agreed to new terms under threat, it could open what he described as “a Pandora’s box of what the government could do to assert power and control over private companies,” as reported by the AP.