FlightAware Sues Kalshi Over Flight Cancellation Markets — Alleging Unauthorized Data Use, Trademark Infringement, and Aviation Safety Risk

FlightAware, the flight tracking company whose data is used by airlines, airports, and aviation authorities globally, has filed a federal complaint against Kalshi over its flight cancellation prediction markets. Kalshi launched the markets last month, telling users outcomes are 'verified from FlightAware.' FlightAware says it was never consulted and never consented. The complaint alleges breach of contract, trademark infringement, and unfair competition, and seeks a temporary restraining order plus injunctions barring Kalshi from using FlightAware's data and branding for the disputed markets. 'Kalshi never informed FlightAware that it would rely on FlightAware's data to determine the outcome of these betting markets,' the company stated. FlightAware is part of Collins Aerospace, a major US defense and aviation company — the reputational stakes of being associated with a prediction market product without consent are not trivial.

For UK readers, the data rights argument has a direct parallel in sports data regulation. Under the UK Gambling Commission's current framework, operators using official sports data for in-play settlement are expected to source that data through authorised channels — the football leagues' official data licencing arrangements, for instance. The FlightAware case applies the same principle to flight data: if Kalshi uses FlightAware's proprietary tracking information to settle contracts, it cannot do so unilaterally and then name FlightAware in user-facing communications as though the company approved it. The trademark infringement claim is particularly significant in a UK context: UK trading standards and ASA guidelines treat the creation of a false impression of commercial endorsement as an unfair commercial practice, regardless of intent.

The safety argument parallels the wildfire controversy covered last week. Oregon senators warned the CFTC that wildfire betting could incentivize arson; FlightAware argues flight cancellation betting creates incentives for unsafe interference with aviation operations. Kalshi has built in a malicious-act exclusion — contracts do not pay out on cancellations caused by deliberate interference. FlightAware argues this is insufficient: financial incentives around whether individual flights are cancelled exist regardless of the exclusion, and the mechanisms of influence are not all obviously captured by a malicious-act carve-out. The complaint does not allege any actual interference. It is a structural argument about the incentives the contracts create.

The most significant implication of this lawsuit is what it reveals about the data oracle problem. Prediction markets settle based on real-world facts. Those facts come from somewhere — flight data, weather data, sports results, government statistics, clinical trial outcomes. The company or organization that holds that data is not automatically a partner in the prediction market that uses it. Kalshi named FlightAware as its settlement source without a commercial agreement; Polymarket avoided precisely this problem by signing official data partnerships with Genius Sports and Sportradar the week before the FlightAware complaint was filed. If the FlightAware lawsuit succeeds in establishing that prediction markets need formal data agreements to legally name third-party sources in settlement processes, it changes the cost structure of launching new market categories: every new market type requires a commercial data agreement before launch, not after the markets are live and traders have open positions.

Operators mentioned in this article

CFTC-regulated

Kalshi

First fully CFTC-regulated US event-contract exchange.

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