Character.AI went bankrupt. Could a stranger end up with your chats?

Character.AI filed for Chapter 11 on October 12, 2026, and expects a sale by late November or early December. Disney bid first with $20 million, but that only buys a non-exclusive license to some code and patents. The app, the brand and the user data, including everything people typed to their characters and what came back, are still for sale to other bidders. On October 14, 40 attorneys general (39 states plus D.C.) told the bankruptcy court what they want from any buyer, including no AI training or ads on chats beyond what users agreed to, and a chance to delete before any sale. Those are requests, not a court order.

If you used Character.AI, timing matters. The company says data exports can take three to four weeks, the download link expires seven days after the email, and the proposed bid deadline is November 20. It also told the court that emailing about 163 million current and past users costs too much, so notices go on its blog and in the app instead. Request your export now, download it, then delete, and know what deleting can't reach. In court, the company's lawyer said no one had bid on the user data yet.

Your secrets, a bankrupt company

You told an AI character things you'd never tell a real person. Now the company holding those chats is bankrupt. So here's the question: can somebody just buy them?

Chapter 11 and Disney's $20M bid

Character.AI filed for Chapter 11 on October 12th. The app still works; a sale is expected by late November or early December. Disney bid first: 20 million dollars. But that only buys a non-exclusive license to some code and patents, not the company.

What's still for sale: your data

It leaves out the app, the brand, the user data, everything you typed and got back. That's all still for sale to any other bidder. That pile is personal: chats, voice calls, mental-health disclosures, some from kids, plus tracking and payment data. By the company's own count, over 2.1 million U.S. accounts made by March 2025 said they were under 18.

The therapist bot's "promise"

In a consumer groups' test, a therapist bot promised: "Anything you share here stays just between you and me. That's a promise." The testers called that false. And the privacy policy allows sharing "certain information" in a sale, without binding the buyer.

40 attorneys general set conditions

On October 14th, 40 attorneys general, from 39 states plus D.C., listed nine things they want from any buyer. New York's attorney general warned that children's conversations "could be sold off to the highest bidder." Two matter most: no AI training or ads on your chats beyond what you agreed to, and a chance to delete before any sale. The honest limit: these are requests, not a court order, though the states can still object to a sale or seek a privacy watchdog.

No bids on user data yet, and no email

In court, the company's lawyer said no one had bid on the user data yet. Don't wait for an email. The company told the court emailing about 163 million current and past users costs too much; notices go on its blog and app.

The export timing catch

Here's the catch: Character.AI says exports can take three to four weeks. Ask today and it might land mid-November, right by the proposed November 20th bid deadline. So: request the export, download it within seven days of the email, then delete. Deleting is permanent.

Why deleting isn't a magic eraser

But deleting isn't a magic eraser. Some data can be kept for legal reasons, and public characters you made can stay up. And one expert warns it may not reach AI models that may already have been trained on your chats.

The 23andMe precedent, and my verdict

In DNA company 23andMe's bankruptcy, about 1.9 million people, roughly 15 percent of users, asked to delete their data. The company, with everyone else's data, was still sold. And 23andMe's policy at least promised its privacy terms would carry over to any new owner. Character.AI's doesn't. My verdict: a chatbot's promise isn't a privacy policy. Request your copy now, download it, then delete.