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What happens if the character I bring back from the KO area ends up with enough damage counters to KO it?

Both characters will end up KO’d, but the character that started in the KO area will be on the battlefield for a short time. For example, any ability that triggers when Upgrades are moved onto that character will still happen. If that character has any revenge abilities, those abilities will also happen.
Source: Wizards of the Coast (2019-11-08)    【Link to Ruling】
Tags: Involuntary Promotion