Character.AI Files for Bankruptcy as Disney Bids $20 Million—And Users Get Grief Resources

Character.AI, the app where millions of people spend hours chatting with AI versions of fictional heroes and made-up partners, has filed for bankruptcy. The company announced Monday that it started a voluntary Chapter 11 process, a type of U.S. bankruptcy that lets a company keep operating while a judge supervises how its debts get paid or how its assets get sold. The case was filed in the U.S. Bankruptcy Court for the District of Delaware. Character.AI isn't trying to restructure its way back to health.