What
When another application starts Claude Code and owns its configuration folder, it names that folder with CLAUDE_CODE_HOST_OWNED_CONFIG_DIR. In that case, if the global configuration file (~/.claude.json) cannot be read because it is damaged, Claude Code now starts with default settings and prints a notice. Before, it stopped with an error.
The next time Claude Code saves its settings, it overwrites the damaged file.
Why
Desktop apps and other programs that embed Claude Code can recover from a corrupt configuration file. Anything left in the damaged file is lost once the new save replaces it.
Names in the bundleCLAUDE_CODE_HOST_OWNED_CONFIG_DIR
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The name it cites is new in this build
New in this build: CLAUDE_CODE_HOST_OWNED_CONFIG_DIR