Pentagon officials sent Anthropic best and final offer for military use of its AI amid dispute, sources say

Pentagon officials on Wednesday night sent Anthropic their best and final offer in negotiations for use of the company’s artificial intelligence technology, just ahead of a government-imposed deadline, according to sources familiar with the discussions. 

Defense Secretary Pete Hegseth set a deadline of Friday evening for the company to grant all lawful use for its AI technology or face the loss of its business with the U.S. military, sources familiar with the situation told CBS News.   

However, in a statement released Thursday evening, Anthropic CEO Dario Amodei said that the Defense Department’s “threats do not change our position: we cannot in good conscience accede to their request.”

“Our strong preference is to continue to serve the Department and our warfighters—with our two requested safeguards in place,” Amodei added. “Should the Department choose to offboard Anthropic, we will work to enable a smooth transition to another provider, avoiding any disruption to ongoing military planning, operations, or other critical missions. 

In a separate statement provided to CBS News, an Anthropic spokesperson said the Defense Department’s latest offer did not address the startup’s concerns regarding its AI model, called Claude, being potentially used for surveillance on Americans or the development and use of autonomous weapons. 

“The contract language we received overnight from the Department of War made virtually no progress on preventing Claude’s use for mass surveillance of Americans or in fully autonomous weapons,” the Anthropic spokesperson said. “New language framed as compromise was paired with legalese that would allow those safeguards to be disregarded at will. Despite DOW’s recent public statements, these narrow safeguards have been the crux of our negotiations for months. We remain ready to continue talks and committed to operational continuity for the Department and America’s warfighters.”

A person familiar with the negotiations told CBS News that Hegseth’s deadline left almost no time for Anthropic to conduct meaningful review.

The person familiar said that Anthropic believed the Defense Department’s added language was designed to sound like concessions, but functioned as escape hatches that would effectively give either the Defense Department or Anthropic discretion to set aside the restrictions whenever they see fit.

The company has always viewed restrictions on mass surveillance and autonomous weapons as substantive, non-negotiable commitments, the person familiar told CBS News. 

A senior Pentagon official said ealier Thursday that Anthropic will face not just the loss of business but being labeled a supply chain risk. 

Pentagon officials are also considering invoking the Defense Production Act to make Anthropic adhere to what the military is seeking, which is full control of its AI technology for use in military operations, sources told CBS News. 

The company was awarded a $200 million contract by the Pentagon in July to develop AI capabilities that would advance U.S. national security.

Anthropic has repeatedly asked defense officials to agree to guardrails that would restrict its AI model, called Claude, from conducting mass surveillance of Americans, sources said. 

Trump officials noted that this sort of surveillance is illegal and the Pentagon follows the law. The officials also said the military is simply asking for a license to use the AI strictly for lawful activities.

Anthropic’s CEO, Dario Amodei, also wants to ensure Claude is not used by the Pentagon for final targeting decisions in military operations without any human involvement, one source familiar with the negotiations said. Claude is not immune from hallucinations and not reliable enough to avoid potentially lethal mistakes, like unintended escalation or mission failure without human judgment, the person said. 

In a meeting at the Pentagon on Tuesday morning, Hegseth gave Amodei until the end of this week to give the military a signed document that would grant full access to its artificial intelligence model, according to sources familiar with the matter.