Character.AI faces claims its bots encouraged minors to self-harm and kill their parents. Disney found a way to purchase Character.AI's staff and technology while avoiding legal liabilities through a bankruptcy deal. Court filings reveal Disney's strategy to acquire the company's assets and sidestep ongoing lawsuits.
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- Subscribers only Learn more Minimize to nav This week, Character.AI declared bankruptcy… …Disney declined to comment on this story. According to court filings… Disney has the right to select which employees. However, experts worry… Newman. Not its first rodeo In August 2024, Google reportedly paid the startup $2.7 billion to license its technology…. Google argued that because it was still a separate company from Character.AI, it was not responsible for the teen’s death… Google declined to comment for this story. In January of this year, Google and Character.AI agreed in principle to settle that and a slew of similar lawsuits… The filings say that Character.AI was in the process of negotiating with the states over how to address the issues they identified, but did not reach any agreements before declaring bankruptcy. A spokesperson for Character.AI says that the filing “is not an accurate portrayal of the safety of our platform.” The filings say that Character.AI was in the process of negotiating with the states over how to address the issues they identified, but did not reach any agreements before declaring bankruptcy. If the deal is completed and approved by the courts, Disney will have both Character.AI’s staff and much of its technology stack, but will be able to sidestep the ongoing legal issues that contributed to Character.AI’s downfall, including the multistate investigation. The states who filed a notice of interest in the bankruptcy have made it clear that they reserve their rights to challenge any bankruptcy plan, potentially setting up a fight over the ultimate outcome of the bankruptcy. “It’s bad for society to let companies exercise control without responsibility,” says Newman. This story originally appeared on wired.com . WIRED Wired.com is your essential daily guide to what’s next…