What Happens to Your Character.AI Chats in Bankruptcy

Can Character.AI sell user chats to a buyer?

The company’s privacy policy (effective July 1, 2026) has a clause called Business Transfers: “We may disclose certain information, in connection with or during negotiations or closing of any merger, sale of company assets, financing, or acquisition of all or a portion of our business to another company.”

Its regional privacy notice adds that the company may disclose “any or all of the categories of information listed above in the event of a sale or transfer of all or part of our business.” Chats are one of those categories, listed as “Content and communications you submit.”

The same notice says that the company does not sell personal information for monetary consideration and is not a data broker. It also says that California and other states treat some sharing for targeted advertising as a “sale” even when no money changes hands. The notice lists advertising providers as recipients of that kind of “sale” for identifiers, age, approximate location, device data and inferences. For chats and other content you submit, the “sales” column says n/a.

What we have not found: a source that says whether chats are part of any sale, or what a buyer would have to do with them. The company’s blog post says only that “Your information continues to be protected under our Privacy Policy” and that its data practices have not changed.

The company’s bidding procedures motion (Dkt. 15) asks the court to approve Disney Worldwide Services, Inc. as stalking horse purchaser for what it calls the “Disney Target Assets.” This guide has not summarized the motion’s terms. To see whether chats or user data are part of any deal, read the motion and its exhibits on the case docket.

State attorneys general and the consumer privacy ombudsman

On October 14, 2026, a coalition of attorneys general from 39 states and the District of Columbia, named on the first two pages of the filing, filed a Notice of Interest and Reservation of Rights in the case (Dkt. 33). Florida’s attorney general joined that notice on October 20 (Dkt. 58). The notice says the states “would advocate that any purchaser be prepared to implement appropriate processes and procedures to comply with regulatory requirements,” and lists nine (Dkt. 33, pages 23 and 24). Item 8 is the one that matters for your chats: “Maintaining consumers’ ability to access the data held about them and allowing all consumers the opportunity to delete their data prior to any sale of that data.”

In section VIII (pages 24 and 25) the states ask the court, the company and any buyer to make sure any sale of “any product, technology, or personal information” includes terms of protection, “particularly for children.” They also ask for notice to consumers of the protections they can expect. Each state reserves its rights, including the right to seek a consumer privacy ombudsman and to object to any proposed sale, the bidding procedures or a plan.

A consumer privacy ombudsman is a disinterested person the court can have the U.S. Trustee appoint. Under 11 U.S.C. § 332 the ombudsman gives the court information about a proposed sale of personal information. Section 363(b)(1) sets a rule for a company that told individuals it had a policy against passing their personal information to unaffiliated parties: a sale must fit that policy, or the court can approve it after an ombudsman is appointed. How those rules fit the Business Transfers clause above is a question for the court and for lawyers. This guide takes no view. The sources we used do not say whether an ombudsman has been appointed.

What the states asked any buyer to do

This is a plain-words summary of the nine items in paragraph 25 of the states’ notice. Read the notice itself for the exact wording.

1. Use age verification or age assurance that does not rely only on a birthday the user types in.
2. Restrict minors’ access to open-ended chats, and protect minors from sexual, violent and other harmful content in Stories and other non-chat products.
3. Remove characters that present themselves as therapists, psychologists, doctors, attorneys or other licensed professionals.
4. Have content moderation and crisis-response protocols for self-harm, suicide, eating-disorder and substance-abuse content that cannot be defeated with a simple click-through.
5. Have reasonable safeguards, accurate disclosures, risk assessments and consent rules, including before processing sensitive data such as health information shared in chats.
6. Disclose any sale of personal data or disclosure for targeted advertising, and offer opt-outs at the account level.
7. Not use chat content and related data to train or fine-tune models, or for advertising or other commercial purposes, beyond the uses consumers and parents validly agreed to.
8. Keep consumers’ ability to access their data, and let all consumers delete their data before any sale of it.
9. Not make false or misleading claims about the product’s safety, its suitability for minors, whether its characters are human, or any character’s professional credentials.

What the policy says about training, advertising and keeping data

The privacy policy lists several ways the company may use information. They include “to train our artificial intelligence/machine learning models” and “Provide advertising and recruit new users, including provision of tailored advertising.” The policy says the company shares information with service providers such as those that provide data storage, content moderation and analytics.

On retention, the policy says: “We keep your information for the time necessary for the purposes for which it is processed or as otherwise described at the time the information is collected, unless a shorter retention period is required by law.”

Users in the European Economic Area or the United Kingdom can switch off the use of their chat content for training new AI models. On the web, go to Settings, Account, Manage Account & Data, Model Improvement. In the app, go to Settings, Data & Privacy. The help center says the company may still use data to improve search, recommendations and safety classifiers.

What happens to bots you created and your conversation logs

Chats count as “content you submit” in the privacy policy. Under the Terms of Service (last updated August 27, 2025) you keep the ownership you had in what you submit, and, as between you and the company, you own the characters you create and the content you generate. You also give the company a broad license to use that content. The Terms say the company may delete your account and its related files, and that ending your account does not end the company’s rights to your content.

If you created a character that other people can use, the privacy policy says: “we reserve the right to preserve that Character’s characteristics and to keep that Character active on the Services, even if you otherwise delete your data and your account.”

If your characters matter to you, copy their text now. See how to back up your characters.

What you can do now

1. Request your export. The company says it takes 3 to 4 weeks. See how to export your chats.
2. Decide whether to delete. Deletion is permanent, and deleting first loses your chats. See delete now or wait.
3. Ask the company about your data. The policy lists rights to access a copy of your data, to ask for deletion of certain information and to object, depending on where you live. Use the request form at support.character.ai or write to privacy@character.ai. See how to delete your account and data.
4. Think about what you type in future chats. The policy asks users not to include sensitive personal information in chats.

Questions and answers

What happens to my Character.AI chats if it shuts down?

We have not found a source that says. The company says the platform will be wound down if no bid lets it continue, and its policy lets it disclose information in a sale. Export your chats now if you want a copy.

Will Character.AI delete my data?

You can delete your account in the app or on the website, and the company says deletion is permanent. Its policy says it may keep some information for legal reasons and may keep a popular character active.

Does Character.AI sell my chats?

Its regional privacy notice says it does not sell personal information for monetary consideration, and the “sales” column for chats and other submitted content says n/a. The same notice lists advertising providers as recipients of some other data, and it says a sale or transfer of all or part of the business may include any category of information.

Can a buyer read my Character.AI chats?

We have not found a source that says. The policy allows disclosure of information in connection with a sale of company assets. The states asked that any buyer let users delete their data before a sale.

What is a consumer privacy ombudsman?

It is a disinterested person that the court can have the U.S. Trustee appoint under 11 U.S.C. § 332 to give the court information about a proposed sale of personal information. The states reserved the right to ask for one. The sources we used do not say whether one has been appointed.

Is it safe to keep using Character.AI?

This guide cannot say what is safe for you. The company says the service is up and its privacy policy applies. If you are worried, export your chats first and think about what you share in new chats.

Related guides

• Character.AI Bankruptcy and Shutdown Timeline Explained
• How to Delete Your Character.AI Account and Data
• Should You Delete Your Character.AI Account Now or Wait?
• How to Back Up and Export Character.AI Creator Bots

This guide is not affiliated with Character Technologies, Inc. Corrections, and requests from services to be listed or changed, go to hello@castmanor.com.