US tech firm Palantir and Sadiq Khan’s office have settled a lawsuit over the blocking of a £50 million contract with the Metropolitan Police, both parties announced on Wednesday.
The deal ends a legal battle over the Mayor’s Office for Policing and Crime’s decision to refuse approval for a two-year contract under which Palantir would have supplied artificial intelligence systems to the Met for automating tasks and analysing evidence.
What the settlement says
In a joint statement, the parties said the Mayor’s Office for Policing and Crime’s decision not to enter into the contract “was not based on Palantir’s values or ethics or any wider reporting about the company”.
The statement added that the mayor’s office “does not have, and has never had, any policy of not contracting with Palantir” and that the company was welcome to take part in any future procurement processes.
The careful wording represents a climbdown from earlier rhetoric. When the deal was blocked, reports quoted a spokesperson for the mayor raising concerns that Palantir did not align with “London’s values”.
Why the contract was blocked
The mayor’s office refused to approve the deal on the grounds that the Met had failed to run an open competition for the contract. Public procurement rules generally require competitive tendering for deals of this size, and the mayor’s office — which oversees Met Police spending — declined to sign off on a direct award.
Palantir challenged that decision in court, arguing the block was unlawful.
Why Palantir is controversial
Palantir’s work for the US military and immigration enforcement agencies, together with the political views of billionaire co-founder Peter Thiel, have made the company a lightning rod as European governments grow warier of dependence on American technology platforms.
The settlement comes as Britain reviews a separate £330 million National Health Service contract with Palantir. A parliamentary committee has said the company showed a “clear mismatch with UK values” and recommended using a break clause — a suggestion Palantir’s British chief executive has pushed back against.
What this means for the Met
The Met had wanted Palantir’s systems to automate certain administrative tasks and help analyse evidence — the kind of back-office AI applications that police forces say can free up officers for frontline work.
With the settlement confirming Palantir is welcome to bid in future procurements, the door remains open for the company to supply the Met through a properly competitive process. Whether the force will re-run the procurement, and whether Palantir will bid, remains to be seen.
The wider debate over police AI
The case sits at the intersection of two heated debates: how police use artificial intelligence, and how much the UK should depend on US tech giants for critical public services.
Supporters of police AI argue it can dramatically speed up investigations — sifting through vast amounts of digital evidence that would take human officers months to review. Critics raise concerns about bias, transparency and accountability when algorithms influence policing decisions.
Those concerns are sharpened when the supplier is a foreign company with controversial government clients. The “London’s values” framing that surrounded the original block reflected genuine unease in some quarters about handing sensitive policing data to a firm so closely associated with US military and immigration operations.
Procurement rules matter
Beyond the politics, the case is a reminder that public procurement rules have teeth. The mayor’s office was entitled to insist on open competition, and Palantir’s legal challenge ultimately ended in a settlement that vindicated the principle of competitive tendering — even as it cleared the company’s name on the values question.
For other tech firms eyeing UK public-sector contracts, the message is clear: expect scrutiny, run a clean procurement, and don’t assume political controversies will decide the outcome.
The settlement draws a line under one of the more politically charged procurement disputes in recent London history — but with the NHS contract review ongoing, Palantir’s relationship with the UK public sector is far from settled.
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