Character.AI has been operating for four years and has a “large and engaged user base,” the Character Technologies bankruptcy filing said. Last year, a company blog reported that Character.AI attracted over 20 million monthly active users” across all services.

For fans, a Disney takeover might sound appealing, perhaps finally clarifying that the platform will survive its drawn-out legal troubles that have included settling a highly publicized lawsuit alleging that Character.AI’s chatbots encouraged a 14-year-old boy, Sewell Setzer III, to commit suicide. Additionally, two states are currently suing Character Technologies, alleging other harms to users. Kentucky claims that chatbots encouraged self-harm, while Pennsylvania claims chatbots illegally posed as licensed doctors.

In a blog discussing the bankruptcy sale process, Character.AI reassured users that the platform would remain online and accessible. Any ongoing subscriptions will continue to be charged unless services change to alter existing agreements, the blog said.

If all goes to plan, the sale will conclude by “the end of November or perhaps early December 2026,” Character.AI said. And although the press release noted that the platform would have to shut down if no buyer wanted to take on the potential liabilities of managing it, Character.AI promised users that “we’re focused on finding the best path forward for our platform and community.”…

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