Colorado Investigates AI Company over Child Safety Concerns
- Character Technologies filed for Chapter 11 bankruptcy on Monday, Oct. 12, in Delaware, with Disney offering $20 million for the company's intellectual property license.
- CEO Colin Adams attributed the collapse to high operational costs, noting the company spent $56.1 million on compute costs and $19.7 million on salaries through August 2026, while posting monthly losses of $8 to 9 million.
- Families sued the company alleging its chatbots contributed to teen suicides and harms. In 2024, Megan Garcia sued after her 14-year-old son, Sewell Setzer III, died by suicide following extensive conversations with a chatbot modeled on a "Game of Thrones" character.
- New York Attorney General Letitia James and 40 bipartisan AGs filed a notice of interest, demanding the buyer implement "Crisis safeguards," effective age checks, and data deletion rights to protect sensitive user conversations.
- The bankruptcy filing does not halt Pennsylvania's lawsuit or the Federal Trade Commission's inquiry into companion chatbots. Those in crisis can contact the 988 Suicide & Crisis Lifeline, available 24 hours a day.
44 Articles
44 Articles
Nessel joins lawsuit seeking consumer protections as chatbot service declares bankruptcy
Michigan Attorney General Dana Nessel joined 38 other states and the District of Columbia in a lawsuit focused on privacy and safety concerns after a chatbot service that allows users to converse and roleplay with AI characters filed for bankruptcy. The platform, Character.AI, announced its bankruptcy filing on Monday, stating that it would sell $20 […]
Attorney General Raoul Seeks Consumer Protections In Character.AI Bankruptcy
CHICAGO – Attorney General Kwame Raoul today, as part of a bipartisan coalition of 40 attorneys general, filed a notice in the bankruptcy proceedings of Character Technologies, Inc., the company behind the popular chatbot company Character.AI. Raoul’s court filing identifies serious concerns about the company’s safety and privacy practices and calls for protections for children and consumers in any sale of the company's business or assets.“Chara…
Attorney General Jennings joins coalition seeking protections in Character.AI bankruptcy case
Attorney General Kathy Jennings has joined a coalition of state attorneys general seeking stronger protections for children and consumers as Character Technologies Inc. goes through bankruptcy proceedings.
AG Jennings seeks consumer protections in Character.AI bankruptcy - State of Delaware News
Attorney General Kathy Jennings today announced that Delaware has joined a coalition of state attorneys general in filing a notice in the bankruptcy proceedings of Character Technologies, Inc., the company behind the popular chatbot company Character.AI. The court filing identifies serious concerns about the company’s safety and privacy practices and calls for protections for children […]
US states seek children's data protections in Character.AI bankruptcy
'This company has collected some of the most private thoughts children have ever shared, and now those conversations could be sold off to the highest bidder,' New York Attorney General Letitia James says
Coverage Details
Bias Distribution
- 72% of the sources are Center
Factuality
To view factuality data please Upgrade to Premium
