Anthropic PBC sued the Defense Department for declaring that the artificial intelligence giant posed a risk to the US supply chain, further ramping up a high-stakes dispute with the Pentagon over safeguards on the company’s technology.

Executives at the AI startup say companies paused deal talks after the Trump administration labeled it a supply-chain risk, warning the fallout could cause a major revenue hit.

The maker of the Claude chatbot says its research could help identify economic disruptions by measuring how AI is currently reshaping work.

Microsoft is launching Copilot Cowork, a new AI assistant built with Anthropic that can run tasks in the background and work across Microsoft 365 apps, as part of a broader wave of updates including a new $99-per-user E7 licensing tier.

Anthropic sued the U.S. government on Monday, escalating a dispute the AI company frames as retaliation for refusing to remove safety limits on its Claude model.

On X, Microsoft CEO Satya Nadella described Copilot Cowork as “a new way to complete tasks and get work done” in Microsoft 365. According to a Microsoft blog post, Copilot Cowork is capable of searching through and manipulating all of your work data included in Microsoft 365, including “emails, meetings, messages, files, and data.”

The lawsuit filed on Monday argues the designation punishes Anthropic for “protected speech.”

Microsoft is integrating Anthropic’s models into an upgraded version of its suite of workplace tools as it moves to reduce its dependence on OpenAI for its AI products. The tech giant on Monday said that it would embed Anthropic’s Cowork,

Serious technology issues like privacy need to be dealt with clearly, not fought over in social media posts, analysts say.

Anthropic launched Code Review in Claude Code, a multi-agent system that automatically analyzes AI-generated code, flags logic errors, and helps enterprise developers manage the growing volume of code produced with AI.