Tech industry group expresses ‘concern’ to Pete Hegseth over supply chain risk label

Pete Hegseth, US secretary of defense, arrives for a medal of honor ceremony in the East Room of the White House in Washington, DC, US, on Monday, March 2, 2026.

Jim Lo Scalzo | EPA | Bloomberg | Getty Images

A tech industry group, whose members include Nvidia, Google and Anthropic, sent a letter to Defense Secretary Pete Hegseth Wednesday expressing concern over his designating a U.S. company a supply chain risk.

The letter, written by the Information Technology Industry Council (ITI), doesn’t name Anthropic, though the artificial intelligence company was given that label on Friday after failing to come to terms with the Defense Department.

“We are concerned by ⁠recent reports regarding the Department of War’s consideration of imposing a supply chain risk designation in response ‌to a procurement dispute,” ITI wrote in the letter.

The ITI’s other members include Microsoft, Apple and Amazon.

“Contract disputes should be resolved through continued negotiation between the parties, or by the Department selecting alternate providers through established procurement channels,” ITI said. “Emergency authorities such as supply chain risk designations exist for genuine emergencies and are typically reserved for entities that have been designated as foreign adversaries.”

Hegseth announced on X on Friday that the Pentagon would be labeling Anthropic a “supply chain risk to national security,” shortly after President Donald Trump ordered every U.S. government agency to immediately stop using the company’s technology.

The ITI’s letter referenced established processes, including the Federal Acquisition Supply Chain Security Act of 2018 to protect federal information systems from risks, as well as the Federal Acquisition Security Council.

“FASCSA also provides several layers of procedural due process protections to private companies including providing notice requirements and an opportunity to respond prior to making such a designation.” ITI wrote.

Anthropic, which was awarded a $200 million DoD contract in July, had requested that the government assure the company that its technology wouldn’t be used for autonomous weapons or mass domestic surveillance of Americans. The Pentagon objected, demanding that the military be allowed to use the platform for all lawful use cases.

Anthropic wrote in a statement on Friday that it was “deeply saddened” by the decision.

“Designating Anthropic as a supply chain risk would be an unprecedented action — one historically reserved for US adversaries, never before publicly applied to an American company,” Anthropic wrote.

OpenAI CEO Sam Altman said later that day that his company had reached an agreement with the Defense Department, but he wrote on X that “enforcing the SCR designation on Anthropic would be very bad for our industry and our country, and obviously their company.”

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