I think the big problem is that this is more like a sanction, more than the government saying they don't want to do business with them. They government is saying that anyone they do business with can't do business with Anthropic.

So it's extremely important that they get an injunction that allows the cloud compute companies to continue to work them. I think they probably will, but it's really crazy that the government is actively trying to kill them off over this.

While it's difficult to eschew all government money, given the current political climate it would be interesting to turn the tables so to speak: updating their ToS to disallow any use by the federal government

This would hand the federal govt to OpenAI and Google but would certainly be head-turning. Hard to say if it would pay off positively for them though.

The government has near-absolute discretion over whom it contracts with, and no company has a constitutional right to be a federal vendor. Courts treat military technology decisions as core Commander-in-Chief functions subject to minimal judicial review, and the political question doctrine may bar second-guessing what the Secretary deems a security risk.

The supply chain risk statute grants broad, largely unreviewable national security discretion and doesn't require the threat to originate from a foreign adversary.

Finally, the First Amendment claim faces the problem that the government was responding not to abstract speech but to a concrete refusal to provide services on the military's terms, which courts are unlikely to treat as protected expression warranting judicial override of procurement choices.

A pointless publicity stunt because of state secrets privilege that will lead to more extreme actions from the Trump admin against Anthropic like the DoJ pulling the trigger on a selectively prosecuted company ending copyright/hacking case for stealing all their training material.

My trust in the judicial system in the USA is so eroded that I could easily be convinced that this is just a PR move and they don’t expect to win anything that goes against Trump‘s wishes.