Update (October 20, 9:53 pm UTC): This article has been updated to include a statement from Kalshi.
Utah Attorney General Derek Brown announced the filing of a lawsuit against Kalshi, its affiliates and two Susquehanna trading companies, alleging that the prediction markets platform has been facilitating illegal betting in the US state since 2024.
At a press briefing Tuesday, Brown said Utah officials Requested A court ordered the companies to return the roughly $30 million to $60 million in profits they allegedly earned through the illegal event contracts. The Utah attorney general alleged that Kalshi illegally offered his services to more than 32,000 customers in the state, resulting in substantial losses.
“Under Utah law, I have determined that this operation is causing a significant and substantial continuing harm to a substantial number of Utahns,” Brown said. “And so today, we’re asking the court to stop sports, elections, politics, culture and mention the stakes here in Utah.”
Kalshi sued Utah in February after lawmakers passed a bill to qualify betting on prediction markets as gambling under state law. In August, a judge ruled in favor of Utah officials, saying federal rules under the US Commodity Futures Trading Commission (CFTC) do not preempt state gambling laws. An appeals court also rejected Kalshi’s request for an injunction in September, preventing the platform from operating while it appeals.
“Culshi is a federally regulated financial exchange, like the stock market,” Kulshi spokeswoman Jackie McGuick told Cointelegraph in response to the Utah lawsuit. “Our customers trade with each other and set prices. As a national derivatives market overseen by the CFTC, Kulshi answers to federal law, and no single state should have a veto over it. This latest state court action does not affect our ongoing federal litigation.”
Related: The NFL supported New Jersey officials in Scott’s petition over Kalashi.
The legal battle continues across the US.
It is one of many civil lawsuits filed by US state authorities against prediction market platforms such as Kalashi and Polymarket for alleged violations of state gambling laws, many of which involve sports betting. In the United States, only Arizona officials are pursuing criminal charges against Kalshi, but other states, including Michigan, Ohio, Kentucky, Nevada, Massachusetts, Wisconsin and New York, have filed civil suits against one or more prediction market companies.
The Utah case comes as the U.S. Supreme Court considers whether to accept a request to consider New Jersey’s own case against Kalshi over alleged illegal sports betting. The case, if accepted by the high court, could potentially resolve whether prediction market companies fall under the purview of state authorities or the CFTC, which claims “exclusive jurisdiction” over the platforms’ event contracts.
Magazine: Agents can trade 24/7 — but Yat Siu warns that you can lose access at any time.
