Anti-war activists who were infiltrated and spied on by the military for years have now been placed on the domestic terrorist list, they announced Monday. The shocking revelation comes as the activists prepare to sue the U.S. military for unlawful spying.

"The fact that a peaceful activist such as myself is on this domestic terrorist list should be cause for concern for other people in the US," declared Brendan Maslauskas Dunn, plaintiff in the lawsuit. "We've seen an increase in the buildup of a mass surveillance state under the Obama and Bush Administrations."

The discovery is the latest development in a stunning saga that exposes vast post-9/11 spying networks in which military, police, and federal agencies appear to be in cahoots.

Documents declassified in 2009 reveal that military informant John Towery, going by the name 'John Jacob,' spent over two years infiltrating and spying on Olympia, Washington anti-war and social justice groups, including Port Militarization Resistance, Students for a Democratic Society, the Industrial Workers of the World, and Iraq Veterans Against the War.

Towery admitted to the spying and revealed that he shared information with not only the military, but also the police and federal agencies. He claimed that he was not the only spy.

The activists, who blast the snooping as a violation of their First and Fourth Amendment rights, levied a lawsuit against the military in 2009.

"The spying resulted in plaintiffs and others being targeted for repeated harassment, preemptive and false arrest, excessive use of force, and malicious prosecution," reads a statement by the plaintiffs.

The Obama Administration attempted to throw out the litigation, but in December 2012 the 9th Circuit Court ruled that the case could continue.

When the plaintiffs were preparing their deposition for the courts two weeks ago, they were shocked to discover that several Olympia anti-war activists were listed on the domestic terrorist list, including at least two plaintiffs in the case.

The revelations prompted them to amend their lawsuit to include charges that the nonviolent activists were unlawfully targeted as domestic terrorists.

"The breadth and intensity of the spying by U.S. Army officials and other law enforcement agents is staggering," said Larry Hildes, National Lawyers Guild attorney who filed the lawsuit in 2009. "If nonviolent protest is now labeled and treated as terrorism, then democracy and the First Amendment are in critical danger."

Plaintiffs say this case takes on a new revelevance as vast NSA dragnet spying sparks widespread outrage.

"I think that there is a huge potential for the case to set precedent," declared plaintiff Julianne Panagacos. "This could have a big impact on how the U.S. military and police are able to work together."

She added, "I am hopeful we will win."

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