Alibaba just won a small but significant battle in what’s shaping up to be a major legal test of US national security law. A federal judge has ordered the Pentagon to give the Chinese tech giant a temporary reprieve from a provision that effectively forced lobbying firms to choose between representing Alibaba and doing business with the Department of Defense.
The law that started the fight
Section 851 of the fiscal year 2025 National Defense Authorization Act created a new restriction: Pentagon contractors can’t simultaneously represent companies that appear on the Section 1260H list, which identifies entities the Defense Department believes are linked to China’s military.
On June 8, the Pentagon added Alibaba to that list, alongside other major Chinese firms like Baidu and BYD. The list now includes 188 entities total.
The consequences were swift. Five major lobbying firms, including heavyweights Brownstein Hyatt Farber Schreck and Mercury Public Affairs, dropped their contracts with Alibaba in late June. The new restrictions started affecting contracts around June 30.
