Disney to hire most of Character.AI's employees amid bankruptcy

Disney has agreed to hire the majority of Character.AI's workforce following the chatbot startup's bankruptcy filing this week. The legal filing, uncovered by Bloomberg, reveals that Disney will offer employment to at least 60 employees, representing the majority of the workforce, with an estimated $60 million in annual compensation. Character.AI's former CEO, Karandeep Anand, has joined Disney as its first CTO. The filing also notes that the vast majority of employees who received job offers accepted them, though the deal is structured as a stalking horse, leaving room for another company to submit a higher bid. Character.AI, which faced lawsuits and regulatory scrutiny over child safety concerns, had previously stated that Disney would acquire some of its assets for $20 million. The company's struggles include high operational costs and potential litigation-related liabilities, including a lawsuit from the mother of a 14-year-old boy who claimed her son became obsessed with one of Character.AI's chatbots before committing suicide. Despite its large user base, Character.AI has been hindered by these challenges, prompting its recent bankruptcy filing.