AI startup Character.AI removes Disney characters from its chatbot platform after legal letter

Samantha Masunaga, Los Angeles Times on Sep 30, 2025

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In the latest salvo between Hollywood and artificial intelligence companies, tech start-up Character.AI has removed many Disney characters from its chatbot platform after the Burbank entertainment giant sent the firm a cease-and-desist letter, alleging copyright infringement.

Chatbots on the Character.AI platform impersonated well-known Disney characters such as Elsa, Moana, Peter Parker and Darth Vader and generated replies that simulated the "essence, goodwill, and look and feel of each character" and also incorporated their backstories, according to a letter dated Sept. 18 from a law firm representing Disney.

"These actions mislead and confuse consumers, including vulnerable young people, to believe that they are interacting with Disney's characters, and to falsely believe that Disney has licensed these characters to, and endorsed their use by, Character.ai," the letter said. "In fact, Character.ai is freeriding off the goodwill of Disney's famous marks and brands, and blatantly infringing Disney's copyrights."

Disney also raised concerns about reports that chatbots have engaged users in inappropriate conversations.

A spokesperson for the Menlo Park-based startup said in an email that Character.AI responds "swiftly" to rights holders' requests to remove content and noted that all of the characters on the service are generated by users.

On Tuesday afternoon, a few Disney characters remained on the platform, including Elsa from the hit animated film "Frozen." The spokesperson said removing the characters is a process.

"We want to partner with the industry and rightsholders to empower them to bring their characters to our platform," the spokesperson said. "Our goal is to give IP owners the tools to create controlled, engaging and revenue-generating experiences from deep fandom for their characters and stories, expanding their reach using our new, interactive format."

Friction between Hollywood studios and AI firms has been growing.

In June, Disney and Comcast's Universal Pictures sued AI company Midjourney, alleging that its image generator infringed on its copyrighted characters from franchises such as "Star Wars" and "Despicable Me."

Warner Bros. Discovery joined the legal fight earlier this month, alleging that Midjourney's software was producing rip-offs of characters such as Scooby-Doo and Superman.