Chatbot startup Character.AI files for bankruptcy, and Disney is first in line for key assets

What happened: Character.AI filed for Chapter 11 bankruptcy in Delaware to pursue a court-supervised sale of all or substantially all of its assets. Disney is the opening bidder for a license to certain intellectual property. Key numbers: Disney offered $20 million for a non-exclusive, perpetual license. The sale process is expected to finish by late November or early December. Why it matters: Other buyers can still outbid Disney. Character.AI warned it will wind down the platform if no bid is sufficient to keep it running. It cited legal, regulatory, and operational headwinds. Coverage: 8 outlets in 24h

Character.AI filed for Chapter 11 bankruptcy in Delaware to pursue a court-supervised sale of all or substantially all of its assets. Disney is the opening bidder for a license to certain intellectual property.

Other buyers can still outbid Disney. Character.AI warned it will wind down the platform if no bid is sufficient to keep it running. It cited legal, regulatory, and operational headwinds.