Character.ai has initiated voluntary Chapter 11 bankruptcy (blog.character.ai)

https://news.bloomberglaw.com/mergers-and-acquisitions/matt-...

Don't all shares / options go to zero in Chapter 11, or is that only true in Chapter 7 when the lenders take over?

In any case, I'm not sure Character.ai's assets will be worth much or that the employees will have any sort of liquidation preference.

"if it walks like a duck and talks like a duck, it's probably a duck" should apply to acquisitions. These types of acquisitions leave employees (+ other shareholders) holding the bag. It should be illegal.

Along with the rest of the top 5 states where almost everyone lives in the USA?

Have you ever even lived for a significant amount of time outside of California? Ever try New York, Texas, or Florida? Nobody is "shackled to their workstation" there either. California leads in unaffordable living and wealth inequality, and it's not even because those on top in California are living any better than even the upper middle class elsewhere.

The economy is much more than tech and most of those businesses are not in California and don't want to be.

Yes, by offering them things like equity in the company. This practice throws all that out the window though, in essence unilaterally renegotiating the terms of employment. When the leadership team can be acquired independently of the company then these employees can be left with nothing. Sometimes the corp doing the acquisition will throw a bone to the dregs left, but that does not appear to be legally required. It's exploitative and unjust.

Disney is guilty of a lot of crap—everything else that you mentioned and much more—but that specific instance wasn’t their fault and they acted to correct it once they knew.

https://www.snopes.com/fact-check/the-rescuers-topless/

Again, I’m not here to defend Disney, they definitely are rotten, but we can point that out by listing all the things they definitely did badly and on purpose rather than leaning on dubious situations which weaken the argument.

But some cases aren't so obvious, like the cases you mentioned of cartoons, shows, books, etc. Trying to censor any LLM output that might lead to self harm has dangerous implications for free speech and privacy. It might harm more people than it helps.

CA recently passed SB-1119 (Adam's Law) which I'm quite worried about. It forces all chatbot operators to default users into kid mode via § 21811(b), and they have to do age verification to get their adult status back. That could mean face scans and ID verification.

Then, SB-1119 also places limits on what chatbots can say to kids, and the most disturbing one to me is § 21812 (d)(5)(xiv) which prevents chatbots from "Encouraging or instructing a child user to circumvent parental controls or conceal usage."

That word "circumvent" is so triggering to me, given all the abuses of DMCA § 1201's anti-circumvention provision.

Like, if a child is trying to test something on an Android phone, and the chatbot tells them how to root the phone to help them out, now the child can modify the OS-provided age signal required by CA's Age Assurance Act (Cal. Civ. Code § 1798.501) and fake that they're an adult. That might expose the LLM operator to huge liability and I bet most operators will self-censor or ban minors (as Anthropic did) rather than risk a lawsuit.

But again, I support the ban for children.

https://thewaltdisneycompany.com/news/disney-openai-sora-agr...

If you want an unsustainable joyride, then you too can work for a startup headed for chapter 11 (like 8 out of 10 startups).

Also, knowing people in general has never not been valuable. It's arguably the main thing holding most engineers back from success. Plenty of evidence backs this up: Type fewer keys, press more palms.

This is the way tech has always been. Or as Carlin said "It's a big club... And you ain't in it."

Occasionally, you can ride their coattails (there will always be rising tides), but if you don't have the right connections and the right degrees from the right universities, you're not invited to the box seat TLA titles of these things...

The odds are much better than state lotteries, and the payout is higher than the stock market, but most of us still need to do our own financial planning instead of socializing the risks of the founder class as they privatize the gains. And yet, each day I get these ludicrous emails from a16z about which startups started by which all star founders want to hire me for less than I make from passive revenue these days for bread crumbs of equity.

But the thing here is, who needs character.ai in an age of local models and cheap tokens from OpenAI and Anthropic (unless you're very naughty and not shaming, just noting)? High margin role play disrupted by cheap open weight models: how very Clayton Christensen.

Their startups get acquired, or they get acqui-hired because of the founders and core people, who in turn have some pedigree which send strong signals.

If you look at the pattern, it is roughly:

- Top ML/AI researchers from the past 10-15 years - Top ML/AI engineers from top labs or companies

Those above people were hired by FAANG companies or AI startups.

But most important of all, it isn't a overnight success. Many of these have been going at it for 10+ years now. Of course some are relatively young, as in having joined Anthropic or OpenAI more recently (past few years), and launching their own startup after 2022.

It's also about having the right moral flexibility. To be in this particular club, you have to hang out with some people that a bunch of us would really rather not be associated with...

I learned that the hard way with 23&Me.

Obviously the company failed to convert its MAU into paying users, despite the fact the token costs greatly declined over the last years.

You're using amazing technology funded through those financial processes to complain that those financial processes aren't progressing humanity forward lol. Modern AI is the perfect example of how financial systems are important for technological progression.

Thinking complex financial systems aren't contributing to humanity's progress because you don't recognize how it is used to fundamentally support the work that progresses humanity is like thinking taxes are a scam because you don't recognize how much you actually benefit from taxes everyday.

Keeping jobs up after filing for chapter 11 seems irresponsible though.

So the problem is your customers don’t pay for anything and your content is unlicensed

It sounds ridiculous to me.

Not my best wording for the metaphor but why would a company specialized in creating fictional personas for individual users be liable if their fictional personas pretended they had real advice.

Aka how is this different than telling the doctors and the police that a horse told you that you would be hexed if you didn’t try and rob the store?

That's the most understandable read of it, they're giant hypocrites. Sam is beholden to the government, and the U.S. posture is to be as involved in the sex life of its citizens as much as it can, feigning prudishness, while politicians cheat on their pregnant wives with prostitutes.

The fact that we are bringing back abstinence programs when the very people against abortion also disapprove of contraception just shows what a sexually stupid country we are.