Canadian AI company turns away from U.S. government work amid trade tensions

A Vancouver AI firm, Caseway, has publicly rejected opportunities to work for the U.S. government, citing rising trade tensions and political rhetoric from Washington. Caseway, which builds AI tools for legal and defence use, says it will instead pursue contracts with Canadian defence, and markets in Europe and Taiwan. CEO Al Vigier framed the move as principled - he said he cannot assist U.S. AI needs while the country is "threatening" Canada and pointed to President Donald Trump’s repeated suggestions that Canada become the "51st state" as a factor. Turning away meant abandoning a high-profile chance to present at a major industry conference - one of only eight presentation slots that could have opened the door to $50-100 million funding rounds.

The choice exposes a broader vulnerability: Canada’s AI sector remains heavily dependent on U.S. infrastructure and investment. University of Toronto expert Sean Mullin warned that reliance on U.S. clouds and models raises risks for sensitive government and defence data and questioned whether such operations should leave control to foreign platforms. Ottawa has pledged investments in quantum computing, data centres and grid upgrades, but experts say building robust domestic capacity will take years and likely cost millions or billions. Mullin argues Canada is unlikely to spawn AI giants on the scale of OpenAI or Anthropic and should focus on targeted areas where domestic companies can add value.