Key Notes
- A bipartisan coalition of attorneys general is asking for privacy safeguards before Character.AI assets and sensitive user information could pass to a buyer.
- The filing seeks an opportunity to delete data before its sale and limits on training or commercial uses beyond valid user and parental consent.
- Character.AI says its service and data tools remain available, but exports can take three to four weeks and account deletion is permanent.
Character.AI’s bankruptcy has raised a question that goes beyond whether its chatbots stay online: what happens to the private conversations users leave behind? A bipartisan coalition of attorneys general wants protections built into any sale, including an opportunity to delete personal information before it changes hands.
New York Attorney General Letitia James and 39 other attorneys general announced the intervention on October 14. Their concern is that a transaction involving Character Technologies, the company behind the service, could transfer sensitive records to a new owner. The announcement describes a request for safeguards, rather than a ruling that conversations have already been sold.
A Buyer Could Inherit More Than a Chatbot
The New York attorney general’s office says Character.AI holds private chats, voice calls, mental health disclosures and identifying information. It reports more than 20 million monthly users, including over two million accounts registered to people who declared themselves under 18. That makes the treatment of stored conversations a significant part of the sale’s consumer impact.
As we explained in our bankruptcy coverage, keeping the platform running and selling its assets are separate questions. A buyer’s interest in technology does not by itself settle who may access existing conversations, what they can be used for or how users can exercise control over them.
For an AI companion, that distinction matters especially. Users may experience a conversation as a personal relationship, while the service also stores and processes the exchange as data. A change in corporate ownership does not make those disclosures less intimate; it makes the rules governing their future use more consequential.
The States Want Deletion Rights and Consent Limits
The coalition’s court filing asks that consumers retain access to their information and have a chance to delete it before any sale of that data. It also seeks restrictions on using conversations to train or fine-tune models, advertise or pursue other commercial purposes beyond what users and parents validly consented to.
That is a consent-based limit, rather than an unconditional ban on training AI with every conversation. The states also want a comprehensive privacy program, clear disclosures and advertising opt-outs that work across an account rather than only on a particular device. Together, the proposals address both the transfer itself and what a buyer could do afterward.
The filing also seeks stronger age checks, continued protections for minors and removal of characters falsely presenting themselves as licensed professionals. Those requests follow investigations into alleged child-safety and privacy failures. The coalition reserves the option to seek a consumer privacy ombudsman or object to sale procedures and a bankruptcy plan; its filing does not itself grant the requested protections.
What Users Can Do While the Sale Is Pending
Character.AI’s October 12 community update says the service remains available and its privacy and security practices are unchanged. The company expects the sale process to conclude in late November or early December 2026. It warns that the platform will wind down if no proposal secures continued operation.
The company directs users to its existing export and account-deletion tools. Its export instructions say requests can take three to four weeks, with a download link sent by email and valid for seven days. Exporting creates a copy for the user; it is a separate action from requesting deletion.
The deletion instructions warn that account removal is permanent. On the website, the option is under Profile Settings, Account, then Manage Account & Data. Anyone who wants to preserve their own record should understand that distinction before choosing an irreversible account action.
The unresolved issue is what enforceable conditions will accompany a sale. Character.AI describes the tools and protections available today; the attorneys general want safeguards that also bind whatever comes next. For users, the outcome will turn on more than a buyer keeping the app open: it will depend on whether control over personal conversations survives the transaction.
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