Character.AI filed for Chapter 11: what is known about your chats and account

Character Technologies, Inc., the company behind Character.AI, filed a voluntary Chapter 11 petition in the US Bankruptcy Court for the District of Delaware on October 12, 2026. The company says it wants a court-supervised sale of all or substantially all of its assets. If no actionable bid for the platform appears, the company says the platform will be wound down. For now the app is running, paid subscriptions are active, and the iPhone app is still listed on the US App Store, which four other companion apps can no longer say (the post on those removals).

The hearing on the bidding procedures was held on October 30, 2026. At the court’s direction it was set to begin at 9:00 a.m. Eastern instead of 10:00, according to the company’s amended agenda. Law360 reported that Judge Shannon approved the bidding procedures, with Disney’s $20 million offer as the opening bid, and Bloomberg reported that he said he would “strongly encourage” the company to hire a consumer privacy ombudsman but declined to order one. The court signed the order approving the bidding procedures on November 4, 2026 (Docket No. 106) and moved the sale dates later: bids are due November 24, the auction is on December 1 and the sale hearing is December 3 and 4. The dates below, from October 14 to October 30, were the company’s proposals before that order; the current ones are in our November 6 post. The creditors’ meeting follows on November 19.

What Character.AI says

The company’s October 12 post says the platform “remains up and running” and that users can continue to access all services at this time. It hopes the sale will produce a proposal that keeps the platform operating, and says that if no such bid is available, “the platform will be wound down.” On October 12 it expected the sale process to be complete by the end of November or perhaps early December 2026; the court has since set the sale hearing for December 3 and 4.

On subscriptions, it says they remain active and billing is unchanged for now, and that it intends to notify subscribers in advance if the service changes in a way that affects paid features.

On data, the post says user information is still protected under the company’s Privacy Policy and that its privacy and security practices are unchanged. It points users to the account deletion and data export pages. What happens to stored chats in a sale or a shutdown isn’t addressed there.

Users have noticed. A 5-star App Store review dated October 18, headed “I love this app, please save it #SaveCai”, says: “I am devastated at the thought of it possibly being shut down.”

What the case page and news reports add

The case is In re Character Technologies, Inc., No. 26-11603 (BLS), before Judge Brendan Shannon. The case page run by the claims agent Stretto lists the hearing on the bidding procedures for October 30, 2026 at 9:00 a.m. Eastern and a meeting of creditors on November 19.

CNBC quotes the company’s filings as saying the platform became “costly to develop and grow.” Reuters reported that the company attributed the bankruptcy to legal expenses and the high price of computing power and AI talent, and that it was losing between $8 million and $9 million a month before filing.

Disney has agreed to act as the opening (“stalking horse”) bidder for a nonexclusive, perpetual license to some of the company’s intellectual property for $20 million, according to Reuters and CNBC. Other bidders can top the offer. Disney has also hired most of Character.AI’s staff and is providing transition services for the platform.

Chats came up at the first hearing on October 14. According to Reuters, the company’s attorney, Erin Fay, said no buyer had yet made an offer for the user data or the operating chatbot business, and that Disney isn’t interested in the kind of data the state attorneys general are worried about.

At the same hearing, a group of 40 state attorneys general asked the judge to make sure any buyer protects users’ chat histories and improves safety features. Their attorney said the states are negotiating a settlement with the company over allegations that its chatbots impersonated licensed medical professionals and exposed children to sexualized and abusive interactions. New York Attorney General Letitia James said in a statement: “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.” California’s companion chatbot rules, which are a separate matter from this case, are summarized on the laws page.

On October 23, 31 states and the District of Columbia filed an objection to the proposed bidding procedures, Docket No. 66, according to PPC Land’s summary of the filing. The summary says the states reserved the question of whether a consumer privacy ombudsman is required, given that Disney personnel have access to user personal data under the transition services agreement. It also listed the schedule proposed at the time: bids due November 20, an auction on November 23 and a sale hearing on November 24. The signed order later replaced it (see above). PPC Land also reports that the states’ October 14 notice of interest listed nine conditions they want any buyer to meet, including honoring advertising opt-outs consumers exercised earlier, and that the proposed minimum overbid is $21.7 million with a $700,000 break-up fee for Disney. Eight more states joined the objection on October 28 (Docket No. 79), and Florida joined on October 29 (Docket No. 81).

The US Trustee, the Justice Department’s bankruptcy watchdog, objected on October 27 (Docket No. 69). Its filing says the company is offering for sale “substantially all of its assets, including the Character.AI platform and related customer data”, and that any sale of customer data “cannot be approved absent the appointment of a consumer privacy ombudsman.” The company’s reply, filed the same day with Docket No. 73, says its privacy policy as in force on the October 12 petition date “permits the sale and transfer of user data in connection with this Chapter 11 case”, so it does not think an ombudsman is required, but that it is willing to consent to one “under appropriate circumstances.” The reply’s response chart adds that Disney “has no access to the Debtor’s user data” and is not buying personally identifiable information.

On October 30, the day of the hearing, the company filed a revised sale notice (Docket No. 90). It still shows the dates in brackets, as proposals: bids due November 20 at 5:00 p.m. Eastern, sale objections due November 13, an auction on November 23 at 10:00 a.m. Eastern and a sale hearing on November 24. The docket entries through October 30 include orders on procedural motions. The written order was signed on November 4, and the dates in this notice were replaced: bids November 24 at 12:00 p.m. Eastern, sale objections November 18, an auction on December 1 at 10:00 a.m. and a sale hearing on December 3 and 4.

How to export your data

Character.AI’s help page, updated October 8, says you can request a copy of your account data from your profile settings.

• Web: Profile, then Profile Settings, Account, Manage Account & Data, Export Data.
• Mobile app: Profile, then the Settings icon, Legal & Privacy, Export Data.

The export may take 3 to 4 weeks. The company emails a download link to the address on the account, and the link is valid for 7 days from the time the email is sent.

That timing is the practical problem. A request made on October 31 would arrive between November 21 and November 28, around the November 24 bid deadline and before the December 1 auction. Anyone who wants a copy of their chats should ask now, not after the sale is decided. The help page doesn’t say what the file contains or in what format. A 4-star App Store review dated October 26 is headed “Used this for years. Give me a way to archive all of an old chat as pdf.”

How to delete your account

The deletion page says account deletion is permanent and can’t be reversed.

• Web: Profile, Profile Settings, Account, Manage Account & Data, Delete Account.
• Mobile app: open your Profile, tap the settings icon and select Remove Account.

The deletion page gives no timing and doesn’t say how deletion interacts with the bankruptcy case, and the October 12 post only says users can delete their account or export their data. Other apps state more. Kindroid deletes a Kindroid or an account 24 hours after the request, Nomi says personal information is deleted within 28 or so days of confirmation, Janitor AI deactivates an account first and keeps a grace period before permanent deletion, and Replika says deletion in the app is irreversible.

If you pay for c.ai+ or c.ai lite

The company’s help pages describe different steps for the two plans. The c.ai+ FAQ (updated September 14) says you can cancel by going to your profile and clicking “Cancel My Subscription.” The (c.ai) lite FAQ (updated September 18) says that lite subscriptions started in the app are managed or cancelled in App Store or Google Play subscription settings, and that web subscriptions, processed by Stripe, are changed by submitting a request on the support page under “Payments and purchases.” For lite, the plan stays active through the end of the current billing period, and app store refunds follow Apple’s or Google’s policy.

The lite FAQ also says a c.ai+ plan can be managed “anytime through your app store,” which is worded differently from the c.ai+ FAQ. The pages don’t reconcile the two, and neither says which route applies to a c.ai+ plan bought in the app.