[BUG] /init does not read from .cursor/rules

Environment

• Platform (select one):
• [x] Anthropic API
• [ ] AWS Bedrock
• [ ] Google Vertex AI
• [ ] Other: <!-- specify -->
• Claude CLI version: 1.0.16 (Claude Code)
• Operating System: 15.5 (24F74)
• Terminal: Pycharm zsh

Bug Description

When running /init in a project with a .cursor/rules dir it is not read. Claude will check for a .cursorrules dir with is not considered the legacy way of doing in.

Steps to Reproduce

1. Open a repo with a .cursor/rules dir
2. run /init

Expected Behavior

.cursor/rules should be treated the same way as .cursorrules

Actual Behavior

ignores .cursor/rules

Additional Context

Workaround. You can run \init the .cursor/rules directory is the same as the .cursorrules directory and claude code will