Disney agrees to hire at least 60 Character.AI employees

Disney has agreed to make job offers to at least 60 employees of chatbot startup Character.AI, according to a legal filing reported by Bloomberg. The offers cover a majority of the startup’s workforce.

The filing estimates the employees’ annual compensation at $60 million. It says the “vast majority” of Character.AI employees who received offers accepted them.

The agreement is part of a stalking horse bid, meaning another company could still submit a higher offer. Character.AI previously said Disney had agreed to acquire some of its assets for $20 million.

Character.AI filed for bankruptcy earlier this week, according to TechCrunch. Its former CEO, Karandeep Anand, recently became Disney’s first CTO.

The filing cites high costs, potential litigation-related liabilities and regulatory engagement as challenges for Character.AI, despite its “large and engaged user base.” The company has faced a lawsuit brought by the mother of a 14-year-old boy and government investigations over child safety concerns.