I found an Ars piece:

https://arstechnica.com/tech-policy/2024/10/chatbots-posed-as-therapist-and-adult-lover-in-teen-suicide-case-lawsuit-says/

Asked for comment, Google noted that Character.AI is a separate company in which Google has no ownership stake and denied involvement in developing the chatbots.

However, according to the lawsuit, former Google engineers at Character Technologies "never succeeded in distinguishing themselves from Google in a meaningful way." Allegedly, the plan all along was to let Shazeer and De Freitas run wild with Character.AI—allegedly at an operating cost of $30 million per month despite low subscriber rates while profiting barely more than a million per month—without impacting the Google brand or sparking antitrust scrutiny.