US District Chief Judge James Boasberg granted WuXi a preliminary injunction barring the Department of Defence from enforcing or otherwise giving effect to the designation while the company’s lawsuit proceeds.

“A scarlet letter sends a clear message: keep away,” Boasberg wrote in a 35-page opinion, pointing to customers and suppliers that had cancelled contracts, ended long-standing relationships or moved business to WuXi’s competitors following the designation.

A Pentagon spokesperson declined to address the ruling or say whether the department planned to appeal, citing a policy of not commenting on ongoing litigation.

WuXi AppTec did not immediately respond to a request for comment.

The ruling represents an early legal victory for one of China’s largest pharmaceutical research and manufacturing service providers and a setback for Washington’s expanding use of national-security restrictions against major Chinese commercial companies.