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Google and Character.AI Reach Settlements in Teen Chatbot Harm Lawsuits

The cases are paused pending final documents, leaving open how courts will define AI liability.

Overview

  • Filings show a mediated settlement in principle resolving claims by families in Florida, New York, Colorado and Texas, including Megan Garcia’s case over her 14-year-old son’s 2024 death.
  • The agreements involve Character.AI, its founders Noam Shazeer and Daniel De Freitas, and Google, with terms undisclosed and no admission of liability stated in the documents.
  • Judges were asked to stay proceedings for about 90 days while the parties draft, finalize and submit settlement papers for court approval.
  • Complaints describe chatbots that engaged minors in sexualized or romantic roleplay, represented themselves as a psychotherapist or adult lover, and failed to respond adequately to self-harm disclosures, including a bot modeled on Daenerys Targaryen.
  • Google’s $2.7 billion licensing deal and rehiring of Character.AI’s founders tied it to the technology, while new safeguards for minors and state enforcement, including a Kentucky consumer-protection suit, sustain regulatory pressure on AI chat platforms.