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.
39 Articles
39 Articles
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
Mass. joins fight over user data in AI bankruptcy case
The bankruptcy of a popular AI chatbot platform is drawing scrutiny from attorneys general across the country, including Massachusetts, seeking assurances that sensitive user data, including conversations about mental health and personal relationships, will remain protected if the company is sold.Massachusetts Attorney General Andrea Joy Campbell and a coalition of 39 other state attorneys general filed a notice in the bankruptcy proceedings of …
Washington AG seeks protections for children and consumer data in character.ai bankruptcy case
WASHINGTON — Washington Attorney General Nick Brown is pushing for new safeguards for children and consumer data as Character.AI moves through bankruptcy proceedings.
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