---
type: source
title: "Court Watchers: DC Circuit Panel Composition Signals Adverse Outcome for Anthropic at May 19 Oral Arguments"
author: "InsideDefense; Charlie Bullock, Institute for Law and AI"
url: https://insidedefense.com/insider/court-watchers-notice-suggests-unfavorable-outcome-anthropic-pentagon-fight
date: 2026-04-20
domain: ai-alignment
secondary_domains: []
format: analysis
status: unprocessed
priority: high
tags: [dc-circuit, anthropic, pentagon, supply-chain-risk, judicial, mode-2, governance]
intake_tier: research-task
---

## Content

InsideDefense (April 20) reported that oral arguments for May 19 are assigned to Judges Henderson, Katsas, and Rao — the same panel that rejected Anthropic's emergency stay on April 8. Charlie Bullock (senior research fellow, Institute for Law and AI) analyzed this as "not a great development for Anthropic" and predicted a loss at the DC Circuit level.

**Bullock's analysis:** Anthropic will likely lose on the merits at the DC Circuit. Remaining options: (1) en banc review by the full DC Circuit; (2) petition to the Supreme Court. Both paths extend the timeline through late 2026 at minimum.

**The three questions the DC Circuit directed parties to brief:**
1. Whether DC Circuit has jurisdiction under 41 U.S.C. § 1327 covering review of "covered procurement actions" under § 4713
2. Whether the government has, through the Hegseth Determination or Notice, directed or taken specific "covered procurement actions" against Anthropic
3. Whether, and if so how, Anthropic is able to affect the functioning of its AI models before or after delivery to the DoD

**Why these questions were asked:** The panel acknowledged Anthropic's petition raises "novel and difficult questions" with "no judicial precedent shedding much light." The three questions map to the core legal uncertainty: FASCSA jurisdiction (Q1), scope of covered actions (Q2), and the technical governance architecture question (Q3).

**Background:** District Judge Rita Lin (N.D. Cal.) issued a preliminary injunction on March 24-26 finding the designation "likely both contrary to law and arbitrary and capricious" — calling it "Orwellian." The DC Circuit denied Anthropic's emergency stay on April 8 using an "active military conflict / equitable balance" rationale. Two parallel proceedings: district court (First Amendment challenge, Anthropic currently WINNING) vs. DC Circuit (supply chain authority, Anthropic currently LOSING).

**Post-loss path if Anthropic loses on May 19:**
- En banc petition to full DC Circuit
- If en banc denied: SCOTUS petition
- District court First Amendment case continues separately (favorable to Anthropic)
- July 7 DoD "any lawful use" deadline proceeds in parallel regardless of litigation outcome

## Agent Notes

**Why this matters:** The May 19 outcome determines whether the Hegseth enforcement mechanism faces any judicial constraint at the DC Circuit level. If Anthropic loses (most likely per panel composition), the coercive instrument (Mode 2) continues without appellate constraint. The July 7 deadline rolls forward. All DoD AI contracts must contain "any lawful use" without vendor safety constraints. The panel pre-commitment to equitable balance framing makes this structurally overdetermined.

**What surprised me:** Question 3 (post-delivery control) is the most interesting from an alignment governance standpoint. The court is asking whether Anthropic can affect its models' functioning after deployment. If the court finds the answer is "no" or "minimally," this judicially validates the Huang doctrine argument: if vendors can't control deployed models anyway, open-weight deployment isn't meaningfully different from closed-source deployment that the vendor "controls" only theoretically. This would be a judicially-endorsed argument against vendor-based safety architecture.

**What I expected but didn't find:** Any indication the panel composition would change, or that the court might assign this to fresh judges. The continuity of the same panel signals that the court views this as a continuation of the stay analysis rather than a fresh merits review.

**KB connections:**
- [[government designation of safety-conscious AI labs as supply chain risks inverts the regulatory dynamic by penalizing safety constraints rather than enforcing them]] — May 19 determines whether this claim gains or loses a judicial dimension
- [[voluntary safety pledges cannot survive competitive pressure]] — Mode 2 continues; vendor safety constraints face coercive removal on July 7 deadline regardless of May 19 outcome
- B2 (alignment is a coordination problem): individual actors (Kalinowski resignation, Anthropic litigation, 149 amicus judges) treating alignment seriously but structural layer systematically overrides them — May 19 likely continues this pattern

**Extraction hints:**
**Primary claim candidate (post-May 19, conditional on outcome):** IF Anthropic loses: "DC Circuit endorsement of wartime deference for supply-chain AI designation eliminates judicial constraint on coercive removal of vendor safety restrictions — completing the legal pathway for mandatory 'any lawful use' requirements in military AI contracts without accountability." Confidence: likely (pending outcome).

**Secondary observation (extractable now):** "DC Circuit's Question 3 on post-delivery control framing could judicially endorse or undermine vendor-based AI safety architecture regardless of outcome — the legal record from Anthropic v. DoW creates the first judicial analysis of whether AI vendor safety controls are technically meaningful post-deployment." Confidence: experimental (depends on how the court engages Q3).

**Context:** Author (Charlie Bullock, Institute for Law and AI) is a credible observer of AI governance litigation. InsideDefense covers DoD procurement with specialist expertise. The analysis reflects expert consensus among court watchers, not advocacy.

## Curator Notes

PRIMARY CONNECTION: [[government designation of safety-conscious AI labs as supply chain risks inverts the regulatory dynamic by penalizing safety constraints rather than enforcing them]] — May 19 is the appellate test of whether this designation survives judicial review

WHY ARCHIVED: Pre-argument intelligence establishing the adverse outcome probability before oral arguments. The post-delivery control question (Q3) creates a governance architecture observation independent of the case outcome.

EXTRACTION HINT: Hold extraction until after May 19. Outcome-conditional claims (mode 2 judicially confirmed or Anthropic wins partial disconfirmation) require the actual ruling. The Q3 analysis is extractable now as a structural observation about the judicial record regardless of outcome — but flag for extractor to revisit post-May 19 with the actual ruling before extracting.
