Bank of England chief warned the G20 about an AI shock. Courts, the Pentagon and data center neighbors are also sending the bills

Bank of England Governor Andrew Bailey on Monday warned finance ministers and central bank governors from the G20 that risks linked to artificial intelligence and overheated markets could trigger a correction that spreads across the world. At the end of the previous week, the Pentagon lost a case in a California court over whether it could exclude Anthropic from the supply chain for criticizing the government. One day later, and in the same court, the same company received a new lawsuit, this time from the publishing arms of Sony and Warner music groups. An industry that spent two years mostly selling a promise is now starting to receive bills from several sides at once.

The court: the Pentagon punished a company for speaking up

Federal Judge Rita Lin in California on Thursday overturned the U.S. Department of Defense’s decision to label Anthropic a supply chain risk. In a fifty-nine-page ruling, she concluded that the designation was not based on concern that the company might sabotage its model, but on an effort to make an example of it because it had publicly criticized government demands. The dispute began in February, when Anthropic refused to rewrite a contract with the military so that its models could be used for mass surveillance of Americans and in fully autonomous weapons systems. SmartMania ↗

The reach of the dispute was broad. Donald Trump ordered federal agencies to stop using Anthropic’s technology, and Defense Secretary Pete Hegseth instructed that military contractors must also cut business ties with the company if they want to keep supplying the Pentagon. The judge also stressed that the department does not have to use Anthropic’s software and can switch to a competitor, but it must do so lawfully. In the meantime, the department has restricted use of the software and wants to stop using it entirely by the end of September; it is not yet clear whether it will appeal. n-tv ↗

The case is not over even after the win. Another Anthropic dispute with the Pentagon is still before a court in Washington, and the Pentagon has similar agreements with seven other companies, including Google, Microsoft and OpenAI. So the dispute was not about whether the military may use artificial intelligence, but about whether it may punish a supplier for standing its ground. Respekt ↗

The second bill came for how the model is built

The day after that ruling, and in the same court, Sony Music Publishing and Warner Chappell Music, the publishing arms of two of the three major music groups, filed suit against Anthropic over using song lyrics to train the Claude model without a license. The publishers are seeking a jury trial and statutory damages of up to one hundred fifty thousand dollars for each work that was allegedly willfully infringed, and up to twenty-five thousand dollars for each removal of copyright management information. The named songs include All I Want for Christmas Is You, Paper Rings and Eye of the Tiger. Music Business Worldwide ↗

The lawsuit is narrowly framed. It does not claim that learning from music is unlawful in itself, but that the company downloaded illegal copies and that the chatbot reproduces lyrics verbatim or nearly verbatim, even though the websites publishing them pay for licenses. The publishers say they do not yet know how many works are affected. Anthropic disagrees with the accusations and said it intends to defend itself vigorously in court, while the defense used by companies in these disputes rests on the argument that training a model is a permitted use of a work and must be distinguished from what the model outputs. NOS ↗

This is not an isolated case, but another in a long line. With this lawsuit, the publishing arms of all three major music groups are now suing Anthropic, and the company has already gone through one approved settlement in a similar case. In July, a U.S. court approved a $1.5 billion settlement in a class action by writers over training on pirated copies of books, the largest known settlement in U.S. copyright law. There is also a precedent in Europe: in November 2025, a Munich court ruled that OpenAI had violated copyright when ChatGPT reproduced lyrics of German songs. La Repubblica ↗

Bankers are saying it out loud

Bailey’s warning was not about technology, but about market structure. In his view, a highly valued stock market, rising investor leverage and the concentration of money into a small number of large technology companies are all coming together. "The issue is not just that investors are borrowing more, but that leverage is interacting with high valuations and market concentration, especially with growing cross-investment between artificial intelligence companies and operators of giant data centers, in a way that could amplify a future market correction," Bailey said. BBC ↗

The second half of his message was about cybersecurity. Bailey, who also chairs the Financial Stability Board, urged companies to prepare for incidents involving simultaneous outages across multiple companies and called on regulators to prepare steps that support the safe rollout of models. He is not alone: earlier this month, a hundred companies including Google, Microsoft, Anthropic and OpenAI called on governments to strengthen cyber defenses before models become powerful enough to bypass them. BBC ↗

The market itself is asking the same question. Le Monde describes OpenAI and Anthropic as hostile brothers competing for dizzying sums under the watch of nervous investors, with Dario Amodei’s company reportedly overtaking OpenAI, the maker of ChatGPT, in revenue and possibly going public as soon as this year. The Slovak Trend summed it up more bluntly: Anthropic’s stock market debut will show how much investors are still willing to pay for a promise. Trend ↗

The fourth bill comes from the neighbors

Bailey’s list of risks does not stop at models. He also mentions cross-investments between artificial intelligence companies and operators of giant data centers, the part of the boom that has a physical footprint and sits in someone’s backyard. That is exactly where the fourth pressure is rising: concrete, land and electricity.

In Kronstorf in Upper Austria, about fifteen activists climbed onto the building of Google’s data center on Sunday with a banner reading "Rechenzentrum? Nein, danke!" and demanded an immediate halt to construction. The protest was supported by Attac, and the opposition is aimed at the second phase of the campus expansion over fifty hectares that the American company bought years ago in the village near Linz. Activists are bothered by land and energy consumption and fear higher electricity prices. Der Standard ↗

Spain is trying to get ahead of it through regulation, not a ban. Minister for Digital Transformation Óscar López defended the new rules by saying they should prevent bubble effects and impacts on electricity bills, but he rejected a moratorium, saying the government is building data centers. He said he wants to avoid what happened in the Netherlands and Ireland, where a moratorium blocked new projects because of high electricity consumption. The regional government in Aragon criticized the text, saying it was drafted without prior consultation. El Mundo ↗

In the United States, this is becoming an election issue ahead of the November congressional elections. Donald Trump attacked opponents of data centers by saying that municipalities refusing them will end up backward and poor, a shortened version of the industry’s argument everywhere: that these projects bring investment, jobs and tax revenue. Politico adds that concern about the costs of such projects is rising across both parties. So this is not a dispute between Democrats and Republicans, but between the center and the municipalities. Politico ↗

Illustrative photo: Google data center in Council Bluffs in the U.S. state of Iowa. Photo by Chad Davis, Wikimedia Commons, CC BY 2.0 license.

What hotinfo is watching

Whether the U.S. government will appeal Judge Rita Lin’s ruling and how Anthropic’s other case with the Pentagon in Washington court will end.

Whether the Pentagon will in fact stop using Anthropic’s models by the end of September, as announced.

How the court handles the lawsuit by Sony Music Publishing and Warner Chappell Music, especially whether the publishers will quantify the number of affected works.

Whether Anthropic will go public in 2026 and at what valuation.

Whether the Financial Stability Board turns Bailey’s warning into a concrete recommendation for national regulators.

How the second phase of Google’s data center in Kronstorf turns out and whether Spain approves its data center regulation in the submitted form.