An AI startup is suing the US government for taking away Anthropic's new model

Legal tech startup Legion sued the US government on Tuesday over an order requiring Anthropic to restrict access to its Fable 5 and Mythos 5 AI models from foreign nationals, causing Legion to lose access to tools integral to its platform. The lawsuit, filed in Washington, D.C., argues the directive caused immediate and existential harm to Legion, which employs Canadian nationals working remotely from Canada. This marks the first known legal challenge from an Anthropic customer affected by the government's export controls on frontier AI models.

One AI startup just sued the US government for cutting its access to Anthropic's top models https://www.businessinsider.com/anthropic-claude-fable-5-mythos-class-model-release-2026-6 . On Tuesday, legal tech company Legion filed a suit in Washington, D.C. over a government order requiring Anthropic to keep its models Fable 5 and Mythos 5 away from foreign nationals. Earlier this month, Anthropic said it would disable access to both models following a letter from the US government https://www.businessinsider.com/anthropic-disable-mythos-fable-us-export-control-national-security-2026-6 asking it to bar foreign individuals and entities from using the products. The AI lab said this rule would bar some Anthropic employees from using the tools. In order to comply, the company initially disabled access for everyone. Last week, Anthropic restored access to Claude Fable 5 with nationality-based access controls and enhanced onboarding compliance screening. In Tuesday's complaint, Legion said that it was a US-based company that employs Canadian nationals who work remotely from Canada. It added that its litigation technology tools are built on top of frontier lab models, such as those from Anthropic. "Legion is a commercial customer of Anthropic with a contractual right and license to access and use the Fable 5 model, which was integral to building and operating its platform," the company wrote in the filing. "When the directive took effect, Legion lost the latest tool at the center of its development instantaneously." The company added that the order caused it "immediate, irreparable, and existential" harm against competitors because the pace of AI development is so rapid. Legion, founded in 2024 and based in San Jose, develops AI-powered litigation drafting software that helps lawyers automate pleadings, discovery requests, and other court documents. Read more about Anthropic The Department of Commerce didn't immediately respond to Business Insider's request for comment. Legion's lawsuit adds another set of stakeholders to Anthropic's clash with the Trump administration over AI https://www.businessinsider.com/trump-federal-agencies-stop-using-anthropic-technology-department-defense-2026-2 safety and government control over frontier AI models. It may be the first among suits from Anthropic customers who have been complaining about losing access https://www.businessinsider.com/reaction-to-trump-controls-on-anthropic-fable-and-mythos-2026-6 to its most powerful model. When Anthropic first paused access to the model, it said that the government was concerned that someone might try a jailbreak of Fable 5. The company argued that cutting access for a "narrow potential jailbreak" was overkill and would halt all new model deployments.