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A federal appeals court, in a 2-1 decision, upheld the Department of Defense's designation of AI company Anthropic as a supply chain risk, rejecting the company's challenge to the blacklisting. The ruling has implications for Anthropic's ability to secure government contracts and partnerships tied to federal supply chains. The decision underscores heightened scrutiny of AI companies' ties to foreign investment and technology sourcing amid broader national security concerns around artificial intelligence infrastructure.