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Inadev appoints former Attain exec Agarwal as CEO

Ross Wilkers — Fri, 06 Mar 2026 16:27:25 -0500

Inadev, a digital and business transformation provider working in federal and commercial markets, has hired 25-year industry veteran Manish Agarwal as chief executive following his acquisition of an equity stake in the company.

Agarwal joins Indavev to lead the next iteration of its strategy that emphasizes artificial intelligence, analytics, cloud engineering and other emerging technologies as core focus areas.

Under this transition announced Thursday, Inadev's co-founder and current CEO Jitesh Sachdev will move into the role of president. Sachdev will work with Agarwal to shape the company’s operations in that new capacity.

Agarwal is currently managing partner of Attain NextGen Ventures, an investment firm that provides capital and mentorship to emerging tech companies.

He is also a founding member and former president of Attain, which sold its federal business in 2021 to Maximus for approximately $430 million.

Inadev’s federal business has recorded $12 million in unclassified prime contract revenue over the trailing 12 months with U.S. Citizenship and Immigration Services representing 93% of that spend, according to USASpending.gov data. Other customers include the National Oceanic and Atmospheric Administration, plus Internal Revenue Service.

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DCS acquires research and development firm

Ross Wilkers — Fri, 06 Mar 2026 16:23:10 -0500

DCS Corp. has acquired a provider of research, development and engineering services as part of a push to expand across air and space missions.

Arctos Technology Solutions opened for business in 1961 and touts its core focus areas as including structures and materials, propulsion and flight technologies, sensors and electronics, and launch and flight safety.

Through this transaction announced Thursday, DCS is looking to grow a portfolio of applied R&D and technology transition efforts in areas such as hypersonics and advanced manufacturing. Financial terms of the agreement were not disclosed.

Both companies tout the Air Force Research Laboratory as a mutual customer and having a greater combined footprint in the Dayton, Ohio region where AFRL is.

DCS now has 350 people working in support of AFRL, the Air Force Life Cycle Management Center and other key customers at the Wright-Patterson Air Force Base. DCS is an employee-owned company with 2,000 staffers altogether.

KippsDeSanto & Co. worked as financial adviser to ARCTOS in the transaction and Holland & Knight LLP was legal adviser.

Arctos has recorded approximately $22.8 million in unclassified prime contract revenue over the trailing 12 months, according to USASpending.gov data. Air Force work represents almost all of that spend at 97% with the rest from the Federal Aviation Administration and NASA.

DCS’ unclassified prime sales have totaled $245.5 million over the past 12 months with the Army representing 69%. The Air Force is next at 22%, followed by the Navy at 9%.

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Private sector, former military leaders urge Congress intervene in Pentagon-Anthropic dispute

Alexandra Kelley — Fri, 06 Mar 2026 10:00:00 -0500

A coalition of professionals across multiple sectors signed a letter March 5, urging Congress to investigate multiple facets of the ongoing fallout between the Department of Defense and Anthropic, including the designation of the company as a supply chain risk and the ramifications of using artificial intelligence for domestic surveillance and autonomous lethal weapons.

The 35 signatories — consisting of former military officials, industry advocates and private sector leaders — are asking congressional leadership to take action following the Pentagon’s retaliation against Anthropic after the company refused to relax its safety guardrails for agency use.

The letter, addressed to Sens. Roger Wicker, R-Miss., and Jack Reed, D-R.I., as well as Reps. Mike Rogers, R-Mich., and Adam Smith, D-Wash., expresses concern with the Pentagon’s actions in the wake of its disagreement with Anthropic, which include blacklisting the company, setting a problematic precedent for other companies hoping to contract with the federal government, and attempting to coerce the company into compliance.

The group also conveyed a unanimous position on the issue between the Pentagon and Anthropic: that AI should not operate lethal weapons without human oversight, and AI should not be used for mass domestic surveillance of Americans.

“They are not fringe positions,” the letter reads. “The prohibition on fully autonomous lethal weapons is consistent with the laws of armed conflict, including principles of distinction and proportionality codified in the Geneva Conventions. The prohibition on mass domestic surveillance is grounded in the Fourth Amendment and in binding U.S. treaty obligations under the International Covenant on Civil and Political Rights.”

The signatories ask Congress to establish clear statutory policy dictating how the government can use AI in domestic surveillance and autonomous weapons, including boundaries and oversight structures.

The group also requests that Congress use its oversight authority with regard to the supply chain risk designation the Pentagon imposed on Anthropic and consider legislative guardrails to designate supply chain risks in “protecting the United States from foreign threats, not disciplining American companies for disagreeing with the executive branch.”

While the signatories acknowledge the need to give the U.S. warfighter “every advantage,” they ask for congressional action to investigate and create policy to prevent both the misuse of AI in national security contexts and the abuse of excessive executive authority.

“These are among the most consequential questions the United States will face in the coming decade,” the letter reads. “They deserve a proper democratic debate.”

Following the termination of Anthropic’s Pentagon contract, President Donald Trump ordered all federal agencies to stop using Anthropic products in government operations. Experts said that it would “take months” to replace each use case in which Anthropic’s software had been, and the letter’s signatories point out that blacklisting Anthropic and requiring other contractors and partners to sever ties weakens the U.S. global position as a leader in AI adoption.

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The Pentagon’s investment deals draw congressional scrutiny

Lauren C. Williams — Fri, 06 Mar 2026 09:30:00 -0500

Lawmakers have questions about the Pentagon’s increased keenness to take partial ownership stakes in companies, demanding details from defense officials while they weigh the need for legislation.

Government equity investment adds pressure on companies to “stimulate growth” and production without “pursuing control,” Michael Duffey, the Pentagon’s top weapons buyer, said Wednesday during a House Armed Services Committee hearing on the defense industrial base. “We view equity investment as an important tool—amongst a range of tools—that we can apply to build resilience and reduce fragility within the defense industrial base,” Duffey said.

Those other tools include grants and loans, he said, but taking a financial stake in a company has extra benefits, including encouraging companies to put up more of their own funds. Those taxpayer funds can also be returned, unlike grants, which Duffey called a “sunk” cost.

“It creates a partnership with industry, an opportunity not only for the government to provide capital to lead to the kind of growth that we need, such as in the [L3Harris solid rocket motor] deal, but it also crowds in additional private capital. Part of that deal was for L3 to put their own billions of dollars against what we saw as a very high demand for growth within the solid rocket motor industrial base,” Duffey said.

Earlier this year, the Pentagon announced it would put $1 billion into L3Harris’s solid-rocket-motor business to spur production. L3Harris will spend money alongside the government, Duffey said of the deal. The more “skin in the game” vendors have, he said, the more likely they are to increase production capacity.

“We haven't seen the kind of investment that we need in terms of modernizing manufacturing, developing the workforce. We believe [that] equity investment, in some cases—in many cases—in partnership with additional private capital, creates that incentive for better attention to how those dollars are deployed to expand our industry partners’ capability,” Duffey said.

Additionally, each deal “comes with clear milestones” and timelines to “ensure that investment is stimulating the growth that is required,” Duffey said. “We are looking at this as an economic stake in the company. We are not pursuing control.”

Many of the equity investments the Pentagon has made recently relate to critical minerals production. So far, the second Trump administration has invested $2.3 billion on critical minerals supply chain deals since Jan. 20, 2025, buttressed by the Defense Production Act, Duffey testified.

“The Defense Production Act, DPA, is a key component of this investment strategy. The DPA provides the President with the authority to ensure the availability of industrial resources to meet our national defense requirements,” Duffey said in prepared remarks. “We have recently used DPA authorities to make significant investments in critical sectors. For instance, we awarded $29.9 million in September 2025 to develop a domestic supply of gallium and scandium, and we have also used DPA authorities to invest $36.6 [million] in late 2025 in germanium production and $43.4 [million] in September 2025 to establish domestic capability for antimony trisulfide, addressing two of the most pressing critical mineral shortfalls facing the defense industrial base today.”

Duffey also noted that $149 million in DPA Title III funds have gone to eight entities to expand the solid-rocket-motor industrial base.

But lawmakers in both chambers, and across party lines, questioned exactly how the Pentagon was going to monitor and execute equity investments.

“The department's making significant equity investments in companies to ramp up their capability to manufacture. Not a new concept. It's been around, I think, forever," Rep. John Garamendi, D-Calif., said. "How are you monitoring the use of that investment? And ultimately, what will you, will the department be doing with the equity that it has acquired as a result of those investments?”

In opening remarks, HASC Chairman Mike Rogers, R-Ala., welcomed the Pentagon’s use of new financing tools to strengthen supply chain resilience,” because “the status quo was not working. However, Congress needs clearer answers on when equity investments are the right approach.”

During a Feb. 24 hearing on critical minerals supply chains, Senate Armed Services Committee Chairman Roger Wicker, R-Mississippi, praised the Pentagon’s “use of innovative financial tools,” but noted that “little law currently exists” with respect to equity investments.

“I believe these equity-based investments make good strategic sense in many cases, particularly where no free market exists and where we've seen aggressive Chinese economic warfare. However, opinions range [widely] between and within our two political parties,” Wicker said in February, adding the committees have been mulling legislation on the matter.

“While not public, Ranking Member Reed and I had a long series of discussions with our House counterparts, last year, about legislation regarding equity investments. I anticipate that conversation will continue in earnest this year. This legislation is both important and urgent because rebuilding America's critical mineral supply chains will take more than a decade.”

In that same hearing, Sen. Jack Reed, D-R.I., said the Defense Production Act doesn’t explicitly name equity investments.

“I have questions about the legal basis, financial terms and strategic rationale for these transactions. The legal basis, in particular, appears questionable,” Reed said. “The department has argued that the Defense Production Act provides the authority for these investments. However, while the Defense Production Act does authorize the purchase of industrial resources for government use, it does not mention equity investments at all. The fact that the Trump administration's Office of Management and Budget has subsequently requested a legislative proposal to explicitly authorize equity investment suggests that the administration, itself, recognizes the current authority is uncertain. And that should give us pause.”

Michael Cadenazzi, the Pentagon’s head of industrial base policy, fielded those questions and others, saying the deals are designed to provide “performance outcomes” for companies and that equity stakes will be used as an “alternative to other financing mechanisms,” such as direct grants.

Equity investments prove the department’s commitment to “solving these problems, which are outsized relative to our normal focus on it” and “equity is a necessary tool for us to make that commitment,” he said.

“Our goal is not economic returns. We're not trying to excise long-term ownership of these companies. The goal is not to have a stake forever. The goal is to achieve our outcome, execute some sort of exit strategy as appropriate to the moment, and then continue on with the next set of problems,” Cadenazzi said. “Ideally, we wouldn't be spending much time on minerals.

We feel compelled to do so as a result of the situation in the market.”

Duffey and Cadenazzi left their hearings with a little homework at lawmakers’ request: submit details of the equity deals and legal justifications, respectively.

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Federal acquisition is getting a shared services makeover

Nick Wakeman — Thu, 05 Mar 2026 15:39:32 -0500

The Office of Management and Budget and the General Services Administration are taking concrete steps to shrink the number of acquisition systems operating in the federal government.

Civilian agencies alone have 229 systems.

“That’s just wrong in this day and age where so much is easily procured commercially,” Eric Ueland, deputy director for management at OMB, said Thursday at an event hosted by the Shared Services Leadership Coalition in Washington, D.C.

The government wants to create a new Quality Service Management Office focused on acquisition. QSMO organizations are shared service providers that agencies use to acquire standardized services such as financial management, cybersecurity and grants management.

A QSMO focused on acquisition would give agencies access to tools such as contract writing systems, data analytics, best practice templates, training and support.

“Our acquisition workforce across the federal government needs this shared service focus,” Ueland said. “I’m happy to say that in partnership with GSA, we’re going to launch a QSMO.”

An early focus will be on “what’s easy to use, easy to understand, and easy to execute,” he said.

Ueland said the 229 civilian acquisition systems could be reduced to one, calling the proliferation of acquisition systems “inexcusable.”

“That’s just on the civilian side,” Ueland said. “I can’t even begin to give you a guesstimate on the non-civilian side. But as time unfolds, we anticipate tearing into that as well.”

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B/Core acquires another intelligence community specialist

Ross Wilkers — Thu, 05 Mar 2026 13:18:52 -0500

B/Core, a technology integrator focused on national security programs, has acquired a fellow company focused on the intelligence community in a continuing push to expand in that customer set.

Heidi Gerhards founded Fuel Consulting in 2004 to concentrate on organizational transformation and technology insertion efforts at intelligence agencies. Fuel also works with clients on developing performance frameworks as a way to aid agencies in applying new tech for mission impact.

Financial terms of the transaction announced Thursday were not disclosed. The McLean Group worked as exclusive financial adviser to Fuel.

Private equity firm NewSpring Holdings acquired the B/Core business in July 2023 and has since supported a handful of purchases to build it into a larger IT and digital transformation provider for IC and Defense Department agencies.

NewSpring is the same investor behind Avantus Federal, which QinetiQ’s U.S. subsidiary acquired in 2022 for $590 million.

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Sierra Space and Vast detail their Series C investment rounds

Ross Wilkers — Thu, 05 Mar 2026 13:18:01 -0500

Sierra Space

This privately-held company has collected $550 million in Series C capital amid a pivot from its original civilian and commercial focus, dating back to its 2021 start as a spinout of Sierra Nevada Corp.

Sierra Space is now prioritizing national security programs in its strategy, while the newfound investment will go toward efforts at new product development and expansion of production capacity.

The completion of this round follows Sierra Space’s hire of new chief executive Dan Jablonsky, the former CEO of Ursa Major and Maxar Technologies.

Sierra Space’s federal portfolio includes a $450 million contract to build at least four satellites for an unnamed agency and a separate potential $740 million contract to build 18 satellites for the Space Development Agency.

SDA is integrating those satellites for the Tranche 2 Tracking Layer of its Proliferated Warfighter Space Architecture, a next-generation constellation for missile tracking and warning functions.

LuminArx Capital Management led the Series C round, which pushes Sierra Space’s touted valuation to around $8 billion. General Atlantic, Coatue, Moore Strategic Ventures and Andalusian Private Capital are also in the company’s network of investors.

Vast

This space station developer has fetched $500 million in new capital to move forward on its roadmap for developing habitats to operate in low-Earth orbit, as well as on the Moon and Mars.

Vast was founded in 2021 by board chairman Jed McCaleb is also eyeing opportunities in national defense for this new phase of its strategy. Max Haot was promoted to CEO in 2023 from his former role of president and joined Vast in 2023 upon its acquisition of Launcher, which he founded in 2017.

The company is positioning its Haven-1 as a successor to the International Space Station and received an order from NASA in February for a private astronaut mission to the ISS, targeted to launch no earlier than the summer of 2027. By 2030, Vast aims to support continuous crew operations in space and the larger LEO economy.

Balerion Space Ventures led the round, which includes $300 million in Series A equity and $200 million in new debt financing. In-Q-Tel, the intelligence community’s venture investment arm, is continuing its involvement after first backing Vast in the fall.

McCaleb also participated in the round alongside Qatar Investment Authority, Mitsui & Co., MUFG, Nikon, Stellar Ventures, Space Capital and Earthrise Ventures.

Advisor A.C. Charania, a former NASA chief technologist for NASA and adviser to Balerion, is joining the Vast board as part of the transaction.

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SBA boots 628 more companies from 8(a) program

Nick Wakeman — Thu, 05 Mar 2026 11:00:15 -0500

The Small Business Administration has removed 628 more companies from the 8(a) program because the agency says they did not comply with an order to turn in three years’ worth of financial data.

SBA requested the information from all 4,300 8(a) companies in December as part of its campaign to remove what the agency considers illegal diversity, equity and inclusion practices. SBA is also scrutinizing pass-through work at 8(a) companies.

This new set of 628 was part of a group of 1,091 companies that SBA suspended from the 8(a) program in January because they did not provide the data by the initial Jan. 5 deadline. SBA said at the time that the portal for submitting the data would remain open until Feb. 19.

Companies also have the option of appealing their removal to SBA and at the U.S. Court of Federal Claims.

Suspension and removals of companies from the 8(a) program for not complying with the data request are not the only actions SBA has taken against the program.

In February, SBA announced plans to terminate 154 8(a) companies headquartered in the Washington, D.C. region because the firms failed to meet “economic disadvantage” eligibility requirements. Those companies were suspended through March 11, when their termination becomes final.

When added together, the total termination actions hit 782 out of nearly 4,300 8(a) companies in the program. If all of the terminations become final, SBA will have cut the program's participation roster by 18.2%.

Other moves against the 8(a) program include reducing the Biden Administration’s 15% 8(a) contracting goal back to the statutory goal of 5%. Contracting officers were also warned of penalties if they failed to report suspected fraud, waste and abuse involving 8(a) contracts.

SBA also launched an audit in June of the 8(a) to look at contacts over the past 15 years. The Defense Department launched its own 8(a) audit in January.

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House amendment responding to Pentagon-Anthropic conflict fails committee vote

Alexandra Kelley — Thu, 05 Mar 2026 04:00:00 -0500

An amendment to the Defense Production Act that would have specifically forbidden government agencies from blacklisting firms that refuse to deploy their high-risk technology products in situations that could harm U.S. citizens failed to move forward during a House Financial Services Committee markup on Wednesday.

The proposal was rejected in a 16-25 vote.

Rep. Sam Liccardo, D-Calif., introduced the amendment in response to the ongoing fallout between the Department of Defense and Anthropic after the company refused to relax their AI safety standards for Pentagon deployment.

As a result, President Donald Trump ordered all federal agencies to begin offloading Anthropic products from government workflows over the course of the next six months.

“A $380 billion hyperscaler, Anthropic has warned the Pentagon and the public of the potential misuse of its product for mass surveillance of U.S. citizens and for autonomous killing machines that could exceed human constraint. They seek reasonable guardrails,” Liccardo said during the markup. “The Pentagon's bureaucrats and lawyers believe they know better. They told Anthropic that if they sought guardrails, they'd blacklist the company as a supply chain threat preventing any other government agency from buying their software.”

Support for the amendment within the committee fell along party lines, with Reps. Sean Casten, D-Ill.; Bill Foster, D-Ill.; and Maxine Waters, D-Calif., all voicing support for Liccardo’s amendment.

Republican lawmakers disagreed with the context of the amendment.

Rep. Warren Davidson, R-Ohio, said that the amendment was “out of place” in the DPA, due to the bill’s usual bipartisan nature.

“We haven't even figured out what to do on artificial intelligence as a body,” Davidson said. “So the idea that we're going to figure that out and jam it into this amendment I think is problematic.”

Committee Chairman Rep. French Hill, R-Ark., echoed Davidson’s posture, saying that — in the context of the DPA — he didn’t support the amendment.

“The idea is that DPA should be trying to manage scarcity,” Hill said. “At the same time we ought to be, I think, concerned in this committee of undercutting all government authority.”

Hill added that engaging vendors to work on sensitive national defense issues “will always entail procurement for uses that someone may have issue with, but that doesn't mean that it's the government attempting to be retaliatory or punitive.”

Despite the lack of support on that particular measure, both Hill and Davidson agreed that they want to continue working with Liccardo and other Democrats on moving forward with effective AI policy.

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Noda AI, Smack Technologies detail their Series A capital rounds

Ross Wilkers — Wed, 04 Mar 2026 12:19:11 -0500

Noda AI

This developer of orchestration software to manage multiple autonomous systems at a time has fetched $25 million in Series A capital amid its push to meet key delivery milestones.

Noda AI opened for business in 2024 to design an open architecture-based reasoning platform that can integrate different vehicles and other autonomous capabilities into its ecosystem. The idea is to provide operators a chessboard-like setup for managing these mixed fleets and their effects across multiple domains of conflict.

Bessemer Venture Partners led the Series A round that also involved Booz Allen Hamilton’s venture capital arm for investing in startups and other young tech companies.

Noda AI is also partnering with Booz Allen and HII on development acceleration efforts, including work to ramp up the software platform’s integration with 30 different original equipment makers.

Noda AI is led by CEO Philong Duong, who founded the company alongside fellow former Marine Corps instructor Dave Corbett.

Other participants in the round included Alumni Ventures, Bloomberg Beta and Draper Associates. Bloomberg Beta is an early stage VC investment arm of the global financial data and media giant.

Smack Technologies

This frontier artificial intelligence company focused on national security has collected $32 million in seed and Series A capital to push forward on building new domain-specific AI models.

Frontier AI refers to foundation-level models such as ChatGPT, Google Gemini and Anthropic’s Claude that are general-purpose in nature and scalable.

Smack Technologies opened for business in 2024 to bring this approach to defense environments, including via the use of deep reinforcement learning techniques that those three models rely on.

Geodesic Capital and Costanoa Ventures led the Series A round. Other participants included Point72 Ventures, Felicis, First In, Scribble Ventures, Bloomberg Beta, Washington Harbour Partners, Palumni VC, Fulcrum Venture Group, Anomaly Fund, and Fortitude Ventures.

Smack was co-founded by a pair of Marine Corps veterans in Andrew Markoff and Clint Alanis, who also started the company with the goal of helping operators rapidly scale fleets of autonomous decisions and analyze large amounts of sensor data in real time.

The company refers to its product suites as Omega and Alpha, which a bulk of the new funding will go toward in terms of research-and-development. Smack is also using a portion of the capital to grow its technical team.

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CMS launches effort to unify Medicare claims processing systems

Ross Wilkers — Wed, 04 Mar 2026 12:15:56 -0500

The Centers for Medicare and Medicaid Services has opened the window for proposals from industry in pursuit of a potential eight-year contract to provide a new software system for processing and adjudicating Medicare claims.

CMS is specifically asking for a commercial-off-the-shelf resource that can bring together the responsibilities of four other systems into a single environment for managing the claims.

Flexibility and interoperability are cornerstone features of the future ClaimsCore system, which should support more than 2 million active users and process more than 100,00 claims per day.

CMS is using a challenge-based methodology for the competition with initial bids seeking selection to participate due by 11 a.m. Eastern time on March 13, the agency said in a Friday notice to release the final solicitation. No ceiling value for the contract was provided in that document.

The agency will select up to four participants that will compete over three phases, during which bidders will demonstrate and experiment with prototype solutions that run in parallel with CMS’ existing shared systems.

Bidders will have to demonstrate that their platforms can adjudicate Part A, Part B and Durable Medical Equipment claims in near real-time, deliver outputs consistent with legacy results, and provide transparent explanations for any variances.

CMS will down-select vendors through each phase, eventually ending up with one winner that will be responsible for production and implementation.

That vendor will complete installation, integrate with all relevant external systems and process CMS claims data.

No timeline for phase two of the evaluation was given in the final request for proposals, but CMS has indicated it wants to move quickly on the effort. The final RFP points to the contract’s initial base period as ending on Jan. 1, 2027.

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Energy announces $352M in funding for frontier science

Alexandra Kelley — Wed, 04 Mar 2026 10:00:00 -0500

The Department of Energy unveiled a new $352 million funding opportunity for frontier research centers to accelerate emerging energy technologies and systems that will power the U.S. technology landscape.

Announced on Tuesday, the new funding for Energy Frontier Research Centers follows the Trump administration’s May 2025 executive order instructing agencies to prioritize “Gold Standard Science” and is available for U.S. colleges and universities, researchers based in the national laboratory apparatus and private sector companies.

The goal is to address fundamental research challenges in materials sciences, chemistry, geosciences and biosciences.

The focus on these fields serves as a means to advance breakthroughs in areas like critical minerals, quantum computing and advanced manufacturing that are slated to be crucial to new energy technologies and systems.

“For over 15 years, the EFRC program has provided a transformational research environment that has brought together the strengths of our National Laboratories and universities to accelerate discovery, develop innovative tools, and train the next generation of the American energy science workforce,” Energy Under Secretary for Science Darío Gil said in a press release. “The EFRCs will continue to play a vital role in bridging disciplines and institutions, advancing foundational science and strengthening America’s leadership to push forward scientific frontiers critical for new energy technologies.”

Program applicants are required to focus on research topics that address scientific challenges in one of the highlighted topics: unconventional computing paradigms; artificial intelligence and machine learning for materials and chemistry; complex chemical systems; critical minerals and materials; nuclear energy science; subsurface science; electrical energy storage; advanced manufacturing; microelectronics; and quantum systems and computing.

During the second Trump administration, Energy has been a key agency in helping the U.S. dominate in emerging technology and fundamental scientific research. Last fall, the agency unveiled a roadmap to advance fusion energy technologies to support the American energy grid.

During the announcement, Energy Secretary Chris Wright acknowledged artificial intelligence as “a tremendous enabling technology” that is poised to further fundamental science in fusion energy research.

“It's hard to overstate the catalytic effect of artificial intelligence,” he said at the time.

Energy is also at the forefront of the Genesis Mission, a Trump administration program that will create the American Science and Security Platform to unify the U.S. national labs in leveraging high-performance computing to advance emerging technology research.

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Blue Fire Equity builds out defense-intel holdings with Jovian Concepts acquisition

Nick Wakeman — Tue, 03 Mar 2026 15:04:22 -0500

Blue Fire Equity has added its first platform to launch its portfolio through the acquisition of Jovian Concepts, a provider of technical services to the U.S. defense and intelligence community.

Terms of the acquisition announced Monday were not disclosed.

Jovian Concepts was founded in 2007 and has focused on delivering engineering, technical, and operational solutions to national security and federal customers.

USASpending.gov does not list any revenue for Jovian, but that is to be expected given that its customer base is highly-classified.

Blue Fire Equity's website says the group invests in companies generating annual revenue of $10 million-to-$20 million and have customers in intelligence, defense and select civilian agencies. The firm also looks companies that are prime contractors.

"Jovian Concepts stands apart from others because of its care for its people, customers, and mission," Farrah Holder, managing partner of Blue Fire, said in a release. "Our priority is to protect and build on its strengths and people-first culture as cornerstones for continued success."

Richard Scheper, president and CEO of Jovian, said the company was drawn to Blue Fire as a private equity investor because of its collaborative approach.

“This partnership maintains our ability to perform at the highest standards for our customers while creating new opportunities for our employees,” he said.

Evergreen Advisors Capital was financial adviser to Jovian, whose legal counsel was Zarren Law Group. Pillsbury Winthrop Shaw Pittman provided legal counsel to Blue Fire.

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One SEWP VI protest down, nine remain

Nick Wakeman — Tue, 03 Mar 2026 14:15:33 -0500

One SEWP VI protester has won another shot at the competition for the $60 billion IT products and services contract.

NASA has allowed METGreen Solutions back into the competition and will evaluate its proposal for an award.

The nine other protests at the Government Accountability Office remain under review.

All the protesters have challenged NASA’s decision to remove them from the competition. The 10-year contract will have hundreds of winners who will compete for task orders across the government.

NASA faces a tight deadline to make awards, so more corrective actions are a reasonable expectation for the agency to meet its schedule.

SEWP V is set to expire on April 30 and NASA wants SEWP VI to open for business on May 1.

GAO’s deadlines for ruling on the protests fall between late May and early June, significantly after NASA’s goal.

NASA has an incentive to resolve the protests as quickly as possible. If the protests are not resolved, the agency will likely have to extend SEWP V.

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XTec acquired by Germany-headquartered security tech firm

Ross Wilkers — Tue, 03 Mar 2026 14:15:20 -0500

XTec, a provider of secure identity and credential management technologies to government agencies, has agreed to be acquired by a security technology company looking at U.S. public sector as a growth avenue.

Giesecke+Devrient is headquartered in Munich, Germany, and originally was founded in 1852 as a manufacturer of banknotes and other financial-related items. G+D is now a 14,000-employee provider of tech tools for use in payment systems, identities, connectivity, and digital infrastructures.

Through this transaction announced Tuesday, G+D is establishing a larger foothold in North America and adding an XTec business whose ecosystem is authorized at the highest level of the FedRAMP cloud authorization program. Financial terms of the agreement were not disclosed.

XTec will be integrated into the portfolio of Veridos, a joint venture between G+D and fellow Germany-headquartered tech group Bundesdruckerei. From XTec’s perspective, the idea behind this combination is having access to greater resources and reach with the backing of a larger owner.

“Our team has been building trusted relationships with U.S. government agencies since 1992, and we look forward to continuing that work with the added technological strength and reach of G+D and Veridos,” XTec’s president Kevin Kozlowski said in a release.

XTec has recorded approximately $53.5 million in unclassified prime contract revenue over the trailing 12 months, according to USASpending.gov data.

The company captured a potential 10-year, $177.2 million task order in the fall to provide its identity authentication and management technologies for a credentialing program that covers 105 agencies.

Federal employees and contractors are a part of USAccess, which helps credentialed users log into computers and networks. Facility and secured area access, encryption and digital document signature are additional features of USAccess.

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DIA starts the bidding for $14B analysis, support contract

Ross Wilkers — Tue, 03 Mar 2026 14:13:19 -0500

The Defense Intelligence Agency has opened the window for industry to start working on and submitting proposals for a potential 10-and-a-half year, $14.1 billion contract focused on all-source intelligence analysis and production.

DIA’s Missile & Space Intelligence Center is seeking to hire a pool of companies that can help in the research, development and sustainment of new and existing systems that are foundational for military intelligence efforts.

Bids for the multiple-award Contract Operations for Missile Evaluation and Testing contract are due no later than 6 p.m. Eastern time on April 3, DIA said in a Monday notice to release the final solicitation.

The agency is breaking out COMET’s scope of work across five primary mission task areas that include foundational and technical intelligence analysis, foreign materiel exploitation, IT operations, modeling and simulation, and business processes.

Foreign materiel exploitation refers to the process of reverse engineering to understand weapons systems of other countries, including their capabilities and vulnerabilities.

DIA describes that FME area as focusing on software, radio frequency and electro-optical/infrared systems, explosive ordnances, materials science, adversarial artificial intelligence, computed tomography imaging, and microelectronics.

IT operations involves the performance of hardware and software integration across multiple computer infrastructures, networks, laboratories, servers and workstations.

The agency will use a three-step process to make awards, a number of which is not specified in the final request for proposals.

Step one of the process will focus on whether proposals conform to the requirements of the solicitation. DIA is using these four factors in order of importance: security, technical and management capability, past performance, and small business participation commitment.

For step two, DIA will look at the bidders’ likelihoods to offer fair and reasonable pricing. The final step involves determination of whether the competitors are responsible contractors or not.

COMET is a new requirement with no incumbents.

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Agencies begin to shed Anthropic contracts following Trump’s directive

Frank Konkel and Alexandra Kelley — Tue, 03 Mar 2026 12:00:00 -0500

Several agencies have started making moves to phase out use of Anthropic tools, following President Donald Trump’s call for federal agencies to halt operations with Anthropic products as the friction between the company and federal government escalates.

The Department of Treasury confirmed it will stop using Anthropic technology products, including the company’s large language model, Claude, as did the State and Health and Human Services departments.

“The American people deserve confidence that every tool in government serves the public interest, and under President Trump no private company will ever dictate the terms of our national security,” Treasury Secretary Scott Bessent tweeted on Monday morning.

The dispute between Anthropic and the Trump administration began with Anthropic refusing to allow Claude to be used for Department of Defense missions involving mass surveillance of Americans or to guide autonomous weapons. In response, Defense Secretary Pete Hegseth designated Anthropic as a supply-chain risk to national security.

Last July, the Department of Defense awarded a $200 million contract to Anthropic to provide AI capabilities.

Bessent’s pledge to remove Anthropic from Treasury operations follows the General Services Administration’s commitment to align with Trump’s stance, with Administrator Edward C. Forst stating that his agency will remove Anthropic services from the GSA marketplace and from its USAi program.

Anthropic’s products will now no longer be available on the Multiple Award Schedule, a centralized acquisition platform with software services available at favorable rates for government agencies. Per Trump’s order, the government will have a six-month runway to phase out Anthropic from its workflows.

“GSA stands with the President in rejecting attempts to politicize work dedicated to America’s national security. Building resilient, secure, and scalable AI solutions demands alignment, trust, and a willingness to make hard calls,” Frost said. “We’re committed to delivering results for Americans, and working with our AI industry partners who fit the bill.”

Elsewhere in the federal landscape, the State Department confirmed to Nextgov/FCW that it will remove Anthropic services from its workflow.

“In line with the President’s direction to cancel Anthropic contracts, we are taking immediate steps to implement the directive and bring our programs into full compliance,” said Tommy Pigott, the principal deputy spokesperson at State.

State’s Bureau of Consular Affairs made an award of $18,960 in fixed-price purchase order to Anthropic in February, according to GovTribe data.

The Department of Health and Human Services also confirmed that it is beginning to phase Anthropic solutions out of its agency workflows and will no longer offer it to staff.

Emily Hilliard, the press secretary at HHS, told Nextgov/FCW that other softwares — like Anthropic competitors ChatGPT Enterprise and Google Gemini — remain available for “authorized mission-related use in accordance with Department policy and federal information security requirements.”

Industry response

While agencies have generally fallen in line with Trump’s directive to cease use of Anthropic, Hegseth on Friday appeared to escalate the ask to companies, including defense contractors, that work with the U.S. military. In a post on X, Hegseth said that “effective immediately, no contractor, supplier, or partner that does business with the United States military may conduct any commercial activity with Anthropic."

Amazon Web Services, which has a longstanding partnership with Anthropic, did not respond to requests for comment Monday, nor did Google Cloud, Microsoft or Salesforce, all of which have relationships with the company.

The Professional Services Council, which represents several hundred tech companies and defense contractors, advised member companies in a statement to Nextgov/FCW to “work closely with their government acquisition colleagues while we closely monitor this recent designation and what successful compliance looks like within our industrial base."

"Protecting national security supply chains is essential, and how the government designates risk has broad implications across the federal contracting industry,” a PSC spokesperson said. “Designating a U.S.-based company as a potential supply chain risk requires prime contractors and subcontractors to assess reliance, scrub supply chains, attest to compliance, and coordinate closely with contracting officers. The implications also extend beyond the Department of War, as actions such as GSA removing the company from portions of the Multiple Award Schedule add another layer of compliance complexity.”

Editor’s note: GovTribe is owned by Nextgov/FCW’s parent company, GovExec.

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A solicitation misreading knocked these joint ventures out of OASIS+

Nick Wakeman — Mon, 02 Mar 2026 14:38:11 -0500

A misreading of the solicitation knocked a pair of joint ventures out of the running for the General Services Administration’s OASIS+ vehicle.

Now a federal judge has said that even through scores of other companies made the same misreading, there was no ambiguity in the solicitation because the requirement was discussed fully during the question-and-answer phase.

CWS FMTI Joint Venture and Mainsail-OASIS JV went to the U.S. Court of Federal Claims in the summer after they were kicked out of the competition because they only submitting one qualifying project when the solicitation required two.

The joint ventures were competing for spots in the 8(a), HUBzone, women-owned and service-disabled/veteran-owned categories.

They argued that the section of the solicitation requiring one project from the protégé should supersede a more general provision that required two projects.

But the court rejected those arguments in a decision signed on Feb. 9 and released to the public on Tuesday.

Judge Molly Silfen said there was no ambiguity in the solicitation about the requirement for two projects.

“The agency underlined the word ‘and’ to emphasize that offerors needed to comply with both sets of requirements,” Silfen wrote in the decision.

The joint ventures also argued that GSA should have gone to the Small Business Administration for a certificate of competency before disqualifying them.

Silfen rejected that argument as well because SBA certification only goes to whether these are responsible companies.

“Responsibility is different from responsiveness to a solicitation,” she wrote. “GSA’s decision to disqualify plaintiffs from competition implicates not responsibility but plaintiffs’ responsiveness to the OASIS+ solicitation.”

The two joint ventures were not alone in their misinterpretation of the solicitation. GSA rejected 73 proposals for the same misunderstanding, but the judge said that does not matter.

The question about one or two projects also came up during Q&A portion ahead of the final solicitation. Basically, all of these companies should have known that GSA was looking for two projects.

That so many companies misread the solicitation was beside the point.

“Although others shared plaintiffs’ interpretation, a common misunderstanding does not necessarily render any ambiguity latent, particularly where prospective offerors asked ahead of time about the language at issue,” the judge wrote.

A few key takeaways are to read the fine print on socioeconomic set-aside requirements, as well as aggressively use and read the Q&A process.

Finally: when an agency uses the word “and,” it’s requiring what’s on both sides of that “and.”

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How ICF views its return to federal growth

Ross Wilkers — Mon, 02 Mar 2026 14:18:19 -0500

ICF was far from the only publicly-traded contractor that had to navigate a bumpy ride in 2025 that involved Department of Government Efficiency-driven spending reductions and the six-week government shutdown in the fall.

Neither is ICF the only GovCon firm that has to detail what all of that means for investors to consider, but it does provide a snapshot of the federal landscape and an example of how companies have to adjust to changes.

During ICF’s fourth quarter and year-end earnings call with investors Thursday, chief executive John Wasson said the company is looking at a return to growth for its federal business in two buckets.

“We expect IT modernization to return to growth with the improved procurement environment for 2026, and we expect the entire federal business to return to growth in 2027,” Wasson said.

Wasson characterized the federal business as a roughly 50-50 split between its IT modernization portfolio and broader programmatic work.

On the IT front, Wasson said the procurement environment is looking better and opportunities are starting to move even if “it’s not back to where we’d like it.”

For the programmatic side, Wasson acknowledged that “new opportunities there haven’t been as robust as on the IT modernization side” even as the procurement environment there is starting to pick up.

Agencies are unlocking funds on existing contracts and ICF has been “quite successful in winning our recompetes,” Wasson added.

Scrutiny on federal spending will likely continue in 2026 as DOGE activities are now taking place at the department- and agency-level, but a more stable backdrop is leading ICF to see a two-phased trajectory for its federal business.

On the nonfederal side of ICF, commercial energy is the main growth driver amid the company’s push to bring its advisory and technology-enabled services into that sector.

Utilities are seeking to fulfill increased demand for energy as data center construction ramps up across the country, while nuclear reactor developers are positioning for opportunities to supply power for the higher loads.

Wasson characterized the bulk of ICF’s energy sector portfolio as spanning energy efficiency, flexibility management, electric storage and battery storage.

But in more recent years, ICF has been investing more in engineering work as seen by its acquisition of CMY in 2023 and purchase of Applied Energy Group in 2025.

“While that's a smaller part of our business, I think that as we continue to invest the potential for quite significant growth, that's an area where we're looking to deploy our balance sheet in addition to organic growth,” Wasson said of the engineering work.

ICF’s federal business recorded $855 million in revenue during 2025, a 25% decline in sales from those of 2024, owing to the impacts of contract spending cuts and the Oct. 1-Nov. 12 government shutdown. Federal represented 43% of ICF’s revenue profile for 2025, down from the 54% figure for 2024.

Nonfederal revenue climbed 14% year-over-year, primarily on growth in the commercial energy business.

Company-wide fourth quarter revenue of $443.7 million was down 10%, while profit of $46 million showed an 18% year-over-year increase in adjusted EBITDA (earnings before interest, taxes, depreciation and amortization).

Full-year 2025 sales of $1.9 billion were down 5% from the previous year, while adjusted EBITDA of $207.2 million showed a 6% year-over-year decrease on the bottom line. That translates to a 11.1% adjusted EBITDA margin for 2025 versus the 11.2% figure for 2024.

ICF’s initial outlook for 2026 has a revenue range of $1.89 billion-to-$1.96 billion.

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V2X's partnerships with the hyperscalers center on data and processes

Ross Wilkers — Mon, 02 Mar 2026 14:14:16 -0500

V2X, and the heritage Vectrus company before that, have centered their technology strategies around using digital tools as a lever to run facilities and other key physical assets of the U.S. government.

For federal systems integrators like V2X, all roads of their commercial tech industry partnerships inevitably lead to working with the cloud computing giants and using artificial intelligence tools that rely on the hyperscalers’ infrastructure.

During V2X’s fourth quarter and year-end earnings call with investors, chief executive Jeremy Wensinger explained how the company is approaching these collaborations for its work around the world including logistics.

Take for instance smart warehousing, a concept describing storage facilities that rely heavily on automation and other tech-centric management systems as a way to track inventory and digitize processes.

V2X is working with Amazon to bring smart warehousing and automation technologies to their mutual government customers. This partnership will involve the use of Amazon’s computer vision AI models in V2X-managed warehouses.

Wensinger told analysts the idea behind the collaboration is to have Amazon Web Services, the tech giant’s cloud computing subsidiary, work with the data V2X has on and inside warehouses.

“We own all the data and what they own is the process, Wensinger said.

Then there is AI, which Google has made big bets on over many years as highlighted by its Gemini chatbot and virtual assistant. It goes without saying that Gemini is one of the generative AI tools upending so much of the larger technology ecosystem, including how the government uses AI.

V2X and Google are collaborating to deploy the latter’s AI and cloud solutions for government environments, including agencies that want a more digitized infrastructure.

Some core focus areas for V2X and Google include data analysis, training and simulation, logistics and sustainment, risk detection, and resource optimization.

Like the pact involving AWS, V2X is looking at its partnership with Google as one that combines data and process.

“We decided that we wanted to be on with partners whose critical path was the future of AI, and I think Google is that,” Wensinger said. “Google also recognized that we have the information that makes AI operate.

“So when I look at the transformational aspect of AI in our business, I wanted to partner with somebody who brought a tool, and I brought the data and I brought to mission capability, and I want that in the context and the contract that enable that AI to work.”

IBM is a third commercial tech partner of V2X that Wensinger brought up for analysts on the call to consider. That reference harkens back to how the heritage Vectrus business emphasized converged infrastructure in its strategy, which was led by several former IBM executives who made their way to Vectrus.

For V2X, working with Big Blue means integrating AI and computer vision tools for U.S. military and government missions worldwide. This partnership centers around IBM’s Maximo Application Suite, an enterprise asset management software product designed with conversational and generative AI tools to help users quickly retrieve and summarize data.

On the matter of AI as a whole, Wensinger said V2X is “going to be enabled by this transformational technology because we have all the mission know-how.”

He added the partners V2X is working with also enable the contractor “to network much better, much faster and much more efficient and delivering my customer a much better outcome.”

Fourth quarter revenue of $1.2 billion was up 5% from the prior year period, while profit of $88.7 million showed a 3% year-over-year increase in adjusted EBITDA (earnings before interest, taxes, depreciation and amortization).

Full-year 2025 sales of $4.5 billion were up 4% from the previous year, while adjusted EBITDA of $323.3 million showed a 4% year-over-year increase on the bottom line. That translates to a 7.3% adjusted EBITDA margin for 2025 versus the 7.4% figure for 2024.

V2X’s initial guidance for 2026 has a revenue range of $4.675 billion-to-$4.825 billion and an adjusted EBITDA outlook of $335 million-to-$350 million.

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SEWP VI protests grow to 10

Nick Wakeman — Mon, 02 Mar 2026 13:14:09 -0500

Two more companies have joined the list of protesters objecting to being kicked out of the competition for NASA’s SEWP VI contract, a $60 billion vehicle for IT products and services.

NASA has not announced winners of the multiple-award contract, but they are telling some companies they are no longer being considered.

That kicked off the first set of protests on Feb. 17, with eight companies filing by Feb. 20.

On Friday, Insight Public Sector and Strategic Communications filed protests of their own to bring the total number of challenges to 10.

They join the earlier protesters:

Blazar Technology Solutions
Blue Obsidian Solutions
Bridges Systems Integration
E-Logic
METGreen Solutions
Professional Information Systems
Sudofy
Z-SofTech Solutions

The Government Accountability Office can combine protests into a single decision if the grounds being raised are similar enough. GAO has not disclosed whether this will be a single decision or multiple decisions.

All the companies are challenging NASA’s decision to remove them from the competition during phase one of the evaluation process.

The protests are a risk for NASA because they may force the agency to delay awards again, currently scheduled for April, when the current SEWP vehicle expires.

If GAO canot resolve the protests before then, NASA would most likely extend SEWP V again.

NASA also is facing prospect of the General Services Administration taking over the SEWP program, which was launched in 1993.

GSA officials have talked about the takeover as a mandate from President Trump’s executive order “Eliminating Waste and Saving Taxpayer Dollars by Consolidating Procurement."

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What rights do AI companies have in government contracts?

Jessica Tillipman — Mon, 02 Mar 2026 12:07:00 -0500

The Anthropic-Pentagon dispute has drawn significant public attention and an equally large amount of misinformation. After Defense Secretary Pete Hegseth gave Anthropic an ultimatum to allow unrestricted use of its AI models “for all lawful purposes” and the company refused, President Trump directed federal agencies to stop using Anthropic’s products and Hegseth designated the firm a “supply chain risk.”

Hours later, OpenAI announced its own Pentagon deal, claiming it included the same two restrictions Anthropic had been fighting for (no mass domestic surveillance, no fully autonomous weapons) while simultaneously agreeing to the “any lawful use” standard Anthropic rejected.

The public reaction has been chaotic, but most of the commentary, from both sides, reflects a fundamental misunderstanding of how the government buys AI. Commentators are debating whether AI companies should be able to restrict the government’s use of their technology, as if this were a novel question. It is not. Contractors restrict the government’s use of their products all the time. Whether and to what extent they can do so in any particular case depends on three things: the acquisition pathway, the contract type and the negotiated contract terms.

Understanding these variables is essential to evaluating what happened with Anthropic, what OpenAI’s deal accomplishes and what any of this means for the future of AI in the defense space.

How the government buys AI and why it matters

The federal government does not acquire AI through a single, uniform process. It uses multiple acquisition pathways, each of which creates a different allocation of rights and leverage between the government and the contractor. As I have detailed in my article, Buying Blind: Corruption Risk and the Erosion of Oversight in Federal AI Procurement, understanding these pathways is essential to understanding the governance risks that follow from each. Below, I list the most common pathways (there are others, but I won’t attempt to catalog them here).

Commercial acquisition (FAR Part 12)

The most common pathway for federal AI procurement treats these systems as ordinary commercial software. Federal Acquisition Regulation (FAR) Part 12 is designed for the government to acquire goods and services already sold in the commercial marketplace, on commercial terms. The regulation explicitly limits the government’s ability to impose requirements beyond what is customary in the marketplace. Contractors selling commercial AI products are not required to grant the government broader usage rights than those granted to other customers. The government can request expanded rights, but contractors must agree, and this often requires additional consideration.

This means that when the government buys AI commercially, the vendor’s standard terms and conditions, including its acceptable use policies, are the default starting point. Restrictions on use are not some exotic demand by activist AI companies. This is the consequence of the government buying commercial products on commercial terms.

License upgrades and enterprise agreements

Many agencies acquire AI capabilities not through standalone procurements but as add-on features to existing enterprise software agreements, such as Microsoft Copilot or Google Gemini. Because these AI capabilities are offered as upgrades to existing licenses, they fall under the terms of the base agreement. Renegotiating AI-specific terms means renegotiating the entire enterprise deal, which means commercial defaults typically prevail.

GSA multiple award schedule

When agencies order through the GSA Schedule, they inherit whatever terms GSA negotiated at the master agreement level. Downstream ordering agencies have limited authority to modify those baseline terms. If the master agreement includes the vendor’s acceptable use policy, individual agencies generally cannot override those restrictions.

Negotiated procurements (FAR Part 15)

FAR Part 15 gives agencies the broadest latitude to negotiate tailored terms, including provisions regarding usage rights, data rights, transparency and governance. But this pathway comes with high procedural costs and longer timelines. In practice, agencies often avoid Part 15 for fast-moving AI purchases because it is slower and more process-heavy and DOD leadership has emphasized commercial-first, rapid pathways.

Other transactions (OTs)

OTs are non-FAR-based agreements used for research, prototyping and certain production activities. They offer substantially more flexibility than FAR-based contracts. In 2025, the DOD used this pathway to award agreements valued at up to $200 million each to Anthropic, OpenAI, Google and xAI. OTs are exempt from FAR requirements, so the terms are whatever the parties negotiate. An agency can use this flexibility to secure broad usage rights. A contractor can use it to embed restrictions. Either way, the terms are a product of negotiation, not a regulatory default.

What this means in practice

Each of these pathways produces a different set of contractual rights and obligations. The idea that a contractor categorically cannot restrict government use of its products, or that doing so is somehow illegitimate, reflects a fundamental misunderstanding of how government procurement law works. The scope of restrictions is determined by the specific acquisition pathway and what the parties negotiate. None of this is novel or controversial. It is basic procurement law.

What does “any lawful use” mean?

This brings us to the central confusion in the public debate: what does the “any lawful use” standard actually do?

OpenAI has published relevant language from its Pentagon contract. It reads, in part:

The Department of War may use the AI System for all lawful purposes, consistent with applicable law, operational requirements, and well-established safety and oversight protocols.

The contract addresses autonomous weapons, surveillance and domestic law enforcement. In the provisions OpenAI has published, the operative language is largely framed by reference to existing legal authorities, including DOD Directive 3000.09, the Fourth Amendment, the Foreign Intelligence Surveillance Act, Executive Order 12333 and the Posse Comitatus Act. The system “shall not be used for unconstrained monitoring of U.S. persons’ private information as consistent with these authorities.” Domestic law enforcement use is permitted only “as permitted by the Posse Comitatus Act and other applicable law.”

Read on its face, the published excerpt does not give OpenAI an Anthropic-style, free-standing right to prohibit otherwise-lawful government use. The operative standard is “all lawful purposes,” conditioned on applicable law and related government requirements and protocols.

That does not mean the language is meaningless. There is an important distinction between the scope of a restriction and its enforceability. Restating legal requirements in a contract may not change what the law requires, but it can change remedies if the government’s use violates a contractual commitment. OpenAI generally would not be a proper plaintiff to assert Fourth Amendment rights on behalf of third parties, but it could frame noncompliance as a breach of its own agreement, and OpenAI states it could terminate the contract if the government violates its terms.

Contrast this with what Anthropic sought: explicit exceptions to “lawful use” that would have barred certain uses even if the government viewed them as lawful. Anthropic describes the impasse as turning on two requested exceptions: mass domestic surveillance of Americans and fully autonomous weapons. From the government’s perspective, that approach would effectively place a private contractor in the position of deciding which otherwise lawful uses were off-limits.

The safety stack: where real leverage may exist

The contract language is not the entire story. In a detailed blog post accompanying its announcement, OpenAI described a multi-layered enforcement approach that goes beyond the four corners of the agreement. This is where the analysis gets considerably more interesting from a procurement law perspective.

OpenAI claims three additional sources of leverage:

Cloud-only deployment with architectural control. OpenAI states that this is a cloud-only deployment—models are not provided on edge devices (where they could be used for autonomous lethal weapons). OpenAI retains what it describes as “full discretion” over its safety stack, including the ability to run and update classifiers that monitor use. The company says this deployment architecture enables it to “independently verify” that its red lines are not crossed.

Cleared OpenAI personnel in the loop. The company states that its own security-cleared employees will be involved in the deployment, and that its safety and alignment researchers will “be in the loop and help improve systems over time.”

Termination rights. OpenAI states that, as with any contract, it could terminate the agreement if the government violates the terms (though the scope of any termination right depends on the specific agreement, including notice, cure and dispute resolution provisions that have not been disclosed).

Additionally, OpenAI makes a notable claim about the temporal scope of the contract’s legal references. According to the company, the contract “explicitly references the surveillance and autonomous weapons laws and policies as they exist today, so that even if those laws or policies change in the future, use of our systems must still remain aligned with the current standards reflected in the agreement.” If the full contract language supports this claim, it would constitute a genuine contractual restriction that goes beyond restating current law. Even if Congress amended FISA or DOD revised Directive 3000.09 to permit broader use, the contract could still bind the government to earlier standards.

The published excerpt offers limited support for that reading. The DOD D 3000.09 reference is versioned (“dtd 25 January 2023”), suggesting the contract is keyed to a specific iteration of that directive, though it is not conclusive without seeing the incorporation language. Whether the agreement “locks in” today’s standards, therefore, depends on contract language OpenAI has not published. For example, whether it incorporates these authorities “as in effect on” a particular date, or instead tracks them as amended over time.

These claims deserve careful scrutiny because they reveal something important about where the real contractual leverage lies in AI procurement, and it may not be where most people expect.

If OpenAI retains full discretion over its safety stack and deploys only on its own cloud infrastructure, the practical constraints on government use are architectural, not merely contractual. The government can use the system for “any lawful purpose,” but only to the extent OpenAI’s classifiers and safety systems permit. If a classifier blocks a particular use, the question is whether the government has a contractual right to demand its removal. OpenAI asserts that it retains “full discretion” over those systems.

This creates tension at the heart of the agreement. The contract permits use “for all lawful purposes,” subject to “operational requirements” and “well-established safety and oversight protocols.” OpenAI says it retains full discretion over the safety stack it runs in a cloud-only deployment. If the safety stack blocks a lawful use, which provision controls? The answer depends on the specific contract language governing the relationship between the permissive use standard and the deployment framework—language that has not been made public.

It is also worth noting the irony. The Pentagon’s objection to Anthropic was, at its core, that a private company should not be able to constrain the military’s use of AI technology. Yet the OpenAI arrangement appears to give the company significant operational control over how the technology functions in practice through infrastructure, personnel and classifiers that OpenAI can update unilaterally. Whether this amounts to the kind of constraint the Pentagon sought to avoid with Anthropic depends entirely on the terms governing OpenAI’s discretion and whether the government retains any contractual right to override the safety stack for lawful uses.

Why the acquisition pathway matters for what comes next

The public debate has focused almost entirely on whether AI companies should have the right to impose ethical restrictions on the military. That is a legitimate policy question. But it is the wrong frame for understanding what happened here, and it obscures the procurement realities that will shape AI governance going forward.

As I argue in Buying Blind, the government is acquiring AI technologies through pathways that systematically limit its ability to negotiate protective terms, not just protections for the company, but protections for the government itself. The same commercial acquisition methods that make it difficult for companies like Anthropic to enforce use restrictions also make it difficult for the government to secure adequate transparency requirements, audit rights, data protections and safeguards against contractor lock-in. The emphasis on speed and commercial terms is a double-edged sword: it limits both parties’ ability to impose terms that deviate from commercial defaults.

The Anthropic dispute has focused attention on one direction of this dynamic: companies restricting the government. But the more consequential governance failure runs in the opposite direction: the government’s inability to secure the protections it needs when buying AI through commercial pathways that were not designed for technologies this complex and this consequential.

The government’s punitive response to Anthropic compounds this problem. If the consequence of negotiating aggressively with the government is being designated a supply chain risk—a mechanism more commonly associated with foreign adversary threats—companies have strong incentives to simply accept whatever terms the government demands. OpenAI itself said it does not believe the supply chain risk designation should have been applied to Anthropic. That may lead to faster procurement, but it will yield worse governance outcomes. Companies that are afraid to negotiate are companies that will not push back when the government’s proposed terms are inadequate for either party.

The question the public debate should be asking is not whether AI companies have the right to tell the Pentagon what to do. They do (within the limits of the contract they negotiate), depending on the acquisition pathway, contract type and the terms the parties agree to. The question is whether the government’s current approach to AI procurement produces contracts that adequately protect the public interest. Based on the evidence, the answer is no. The Anthropic-Pentagon dispute, for all the attention it has received, is a symptom of that deeper problem, not its cause.

This post first appeared on Jessica Tillipman's personal website.

Jessica Tillipman is the Associate Dean for Government Procurement Law Studies and Government Contracts Advisory Council Distinguished Professorial Lecturer in Government Contracts Law, Practice & Policy at the George Washington University Law School.

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L3Harris hires former Peraton CFO as new finance chief

Ross Wilkers — Mon, 02 Mar 2026 11:54:19 -0500

L3Harris Technologies has hired a new chief financial officer in Ken Sharp, a three-decade defense technology veteran and most recently CFO at Peraton.

Sharp’s appointment takes effect March 16 and he will succeed Ken Bedingfield, who first joined L3Harris as CFO in December 2023 and later added the duties of president for its missile solutions business segment.

Bedingfield will exclusively focus on leading Missile Solutions as L3Harris prepares to spin out the business via an initial public offering, the company said Monday.

First announced in January, the IPO of Missile Solutions is scheduled to take place in the second half of this year with the U.S. government entering as an anchor investor and L3Harris remaining in place as the business’ controller.

Sharp took up the CFO role at Peraton in December 2023 after three years in the same role at DXC Technology. His career prior to DXC includes a stint as CFO for the defense systems segment at Northrop Grumman.

He also has worked in senior financial leadership roles at Orbital ATK, Leidos, Science Applications International Corp. and the former Computer Sciences Corp.

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WT 360: Enabled Intelligence’s blueprint for the data labeling challenge

Ross Wilkers — Mon, 02 Mar 2026 06:00:00 -0500

Data labeling refers to the practice of tagging and identifying raw data in order to add meaningful context, of which U.S. government agencies openly admit they struggle with and ask industry for help in.

Peter Kant, founder and chief executive of Enabled Intelligence, started the company in March 2020 to specialize in data labeling work that also relies on continuous training and retraining of artificial intelligence models.

Kant joins for this episode to explain how Enabled Intelligence tailors large language models for use in national security environments where the out-of-the-box tools are not quite ready to be in the hands of operators.

In talking with our Ross Wilkers, Kant also describes how the company’s capture of a contract called Sequoia helps shed light on how the government is looking at the challenge of grasping all the data it has.

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Trump directs government to ‘immediately cease’ using Anthropic technology

Frank Konkel — Fri, 27 Feb 2026 18:20:46 -0500

President Trump on Friday directed all federal agencies—including the Defense Department—to “immediately cease all use” of frontier AI firm Anthropic’s technology, though he also said there would be a six-month "phase out period."

Trump’s announcement followed a tense back-and-forth between Anthropic and the Pentagon, which widely uses the San Francisco company’s popular AI platform, Claude, in classified and unclassified networks but took issue with the company’s refusal to give the Pentagon unrestricted access to its models.

In a Thursday statement ahead of the Pentagon’s Friday deadline, Anthropic CEO Dario Amodei said he would not allow Claude to be used for mass surveillance of U.S. citizens or to guide fully autonomous weapons, an argument Trump framed as trying to “strong arm” the Defense Department and force it to “obey their terms of service.”

“I am directing every agency in the United States Government to IMMEDIATELY CEASE all use of Anthropic’s technology,” Trump said in a Truth Social post. “We don’t need it, we don’t want it, and will not do business with them again.”

Trump said there would be a six-month “phase-out period” for agencies using Anthropic’s products at various levels, including classified settings and among civilian agencies. Trump threatened Anthropic with punishment should the company refuse to help in the phase-out. As Defense One’s Patrick Tucker reported Feb. 26, it may take several months or longer for the government to replace Anthropic’s tools.

“Anthropic had better get their act together and be helpful during this phase out period, or I will use the full power of my Presidency to make them comply, with major civil and criminal consequences to follow,” he said.

In his own post, Defense Secretary Pete Hegseth said he was ordering his department to “designate Anthropic a Supply-Chain Risk to National Security.”

Hegseth did not explain why a supply-chain risk would be permitted to operate in classified networks for up to six more months.

Amodei had noted this “contradictory” action in his Thursday statement.

“They have threatened to remove us from their systems if we maintain these safeguards; they have also threatened to designate us a ‘supply chain risk’—a label reserved for US adversaries, never before applied to an American company—and to invoke the Defense Production Act to force the safeguards’ removal. These latter two threats are inherently contradictory: one labels us a security risk; the other labels Claude as essential to national security.”

Founded in 2021, Anthropic has developed models and tools that are already widely used across the federal government, largely through its partnership with leading cloud provider Amazon Web Services, through which it first gained a foothold in the Defense Department and intelligence agencies. Anthropic, along with xAI, Google and OpenAI, received $200 million defense contracts last July to bolster the Pentagon’s push to harness AI.

Meanwhile, the General Services Administration, which manages hundreds of billions of dollars’ worth of contracts on behalf of all agencies, said in a statement Friday it would remove Anthropic from its Multiple Award Schedule and USAI.gov. Federal Acquisition Services Commissioner Josh Gruenbaum tweeted that GSA has terminated Anthropic's OneGov deal, ending the availability of those contracts across the Executive, Legislative and Judicial branches.

“GSA stands with the President in rejecting attempts to politicize work dedicated to America’s national security,” GSA Administrator Edward C. Forst said in a statement. “Building resilient, secure, and scalable AI solutions demands alignment, trust, and a willingness to make hard calls. We’re committed to delivering results for Americans, and working with our AI industry partners who fit the bill.”

The rhetoric used by Trump, Hegseth, Pentagon spokesperson Sean Parnell, and Defense Undersecretary for Research and Engineering Emil Michael was notable for its stridency.

Hegseth posted: “...@AnthropicAI and its CEO @DarioAmodei, have chosen duplicity. Cloaked in the sanctimonious rhetoric of ‘effective altruism,’ they have attempted to strong-arm the United States military into submission - a cowardly act of corporate virtue-signaling that places Silicon Valley ideology above American lives...”

Michael posted, “...It’s a shame that @DarioAmodei is a liar and has a God-complex. He wants nothing more than to try to personally control the US Military and is ok putting our nation’s safety at risk...”

And yesterday, Parnell posted that DOD only seeks the ability to “use Anthropic's model for all lawful purposes,” adding that the idea that the Pentagon wants fully autonomous weapons or mass surveillance is a false narrative “peddled by leftists in the media.”

But in his statement, Amodei said those are the only two limits he insists on.

In “a narrow set of cases, we believe AI can undermine, rather than defend, democratic values. Some uses are also simply outside the bounds of what today’s technology can safely and reliably do,” he said in his statement.

In a statement, Anthropic said it has "not yet received direct communication from the Department of War or the White House on the status of our negotiations."

"We have tried in good faith to reach an agreement with the Department of War, making clear that we support all lawful uses of AI for national security aside from the two narrow exceptions above," the company said. "To the best of our knowledge, these exceptions have not affected a single government mission to date."

Editor's note: This story was updated to include a statement from Anthropic.

Bradley Peniston contributed to this report.

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