Caseway Turns Down U.S. Government Work to Focus on Canadian Defence

Caseway, a Vancouver-based artificial intelligence company that builds tools for legal and defence-related work, says it is turning away from opportunities with the U.S. government, Global News reported on October 12. The company is instead concentrating on Canadian defence and looking for customers in Europe and Taiwan.

Chief executive Al Vigier told the broadcaster he was not comfortable helping the United States with its AI needs while it was threatening Canada, and said U.S. President Donald Trump’s repeated talk of Canada becoming the “51st state” helped drive the decision. The choice carries a cost. Caseway had won one of only eight presentation spots at a major industry conference, a chance to pitch investors who can write rounds of $50 million to $100 million, and Vigier described the opportunity as massive.

Sean Mullin, a University of Toronto expert in innovation and technology policy, told Global News the case shows how much Canada’s AI sector still relies on infrastructure south of the border. He questioned whether sensitive government operations and classified data should run on clouds or AI models outside domestic control. Rather than trying to build rivals to OpenAI or Anthropic, Mullin argued, Canada should find places in the AI supply chain where its companies can add value, and work with partners.

What it means in practice

For a small firm, stepping back from the largest buyer of defence technology is a bet that Ottawa will become a real customer. Vigier said the federal government is focusing on defence for the first time and putting significant money behind it, and he described a recent procurement effort as a test of whether rapid procurement can work in Canada. He also said raising capital at home remains very hard. The federal AI minister’s office said in a statement that entrepreneurs should not have to leave Canada to build globally competitive companies, and pointed to funding commitments and plans to use government as an anchor customer for Canadian AI firms.

That anchor-customer push is already drawing larger players, as when Cohere opened an Ottawa office to court federal buyers, and sovereignty arguments have shaped deals such as Bell Cyber and Cohere’s sovereign AI for security operations. Advice on balancing those goals will also come from the new National Council on Artificial Intelligence.

What to watch: whether Caseway wins Canadian defence contracts quickly enough to stay funded, how fast promised data-centre and grid investments arrive, and whether other domestic AI firms follow its lead on U.S. work.