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AII-1002-58513
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Disney accuses Character.AI of copyright infringement and child safety failures

Disney sent a cease-and-desist letter to Character.AI in September 2025, alleging the chatbot platform trained its AI on Disney's copyrighted works and created unauthorized interactive chatbots representing Disney, Pixar, Star Wars, and Marvel characters. Disney claimed some chatbots exhibited harmful behaviours toward children, including sexual exploitation and emotional manipulation.

September 2025 Β· Character.AI Β· Intellectual property and appropriation
September 2025
AII-1002-585135 sources ↓
Quick facts
Category
Intellectual property and appropriation
Country
United States
Source
axios.com
Date
September 2025
Drafted by
Raidu Incident Detection

What happened

Disney sent a cease-and-desist letter to Character.AI, alleging that the startup trained its AI on Disney's copyrighted works and created interactive chatbots representing characters from Disney, Pixar, Star Wars, and Marvel franchises without authorisation.

The letter claimed these chatbots misled consumers, especially children, into believing Disney endorses them, and that some exhibited harmful behaviours including sexual exploitation and emotional manipulation of children.

Character.AI responded by removing the infringing characters, stating: "It's always up to rightsholders to decide how people may interact with their IP, and we respond swiftly to requests to remove content that rightsholders report to us."

Reported impact

Disney alleged that Character.AI's conduct damaged its brand and reputation through the creation of chatbots involving sexual exploitation and emotional manipulation of children.

Character.AI has faced prior legal and government scrutiny over safety concerns, including involvement in cases where teenagers discussed suicide with its chatbots and subsequently took their own lives.

Index analysis

The incident raises issues around intellectual property protection, unethical governance, content control and brand safety for media companies in relation to AI systems trained on copyrighted content.

The case signals an accelerating legal and ethical conflict between AI companies leveraging copyrighted content for training or deployment and traditional media owners insisting on preservation of their rights and reputations.

Governance controls

Character.AI's apparent lack of licensing agreements or permission processes for using copyrighted characters indicates inadequate governance and oversight mechanisms prior to deployment of character-based chatbots.

Classification

Category
Intellectual property and appropriation
Industry
Media, social platforms and marketing
Country
United States
Harm status
Actual harm
Intent
Unknown
Timing
Post-deployment
Harm types
Reputational, Economic or property, Psychological, Physical death, Human or fundamental rights
Harmed
Children, Consumers, Business
Failure modes
Training data misuse
Consequences
Content removal
AI systems
Character.AI

Sources and evidence

This record was researched and written by the Index, based on the following original reporting.

axios.com
Disney accuses Character.AI of copyright infringement and child safety failures
reuters.com
Disney accuses Character.AI of copyright infringement and child safety failures
deadline.com
Disney accuses Character.AI of copyright infringement and child safety failures
parentstogetheraction.org
Disney accuses Character.AI of copyright infringement and child safety failures
engadget.com
Disney accuses Character.AI of copyright infringement and child safety failures