Federal vs State
The Litigation Scoreboard
Eleven states are in active litigation over who regulates prediction markets. Kalshi has lost five of six PI rulings: Arizona went to the CFTC (May), but Michigan (June), Nevada (May), New York (July 7), Washington (July 21), and Connecticut (August 11) all went against the platforms. Minnesota went to the CFTC — Judge Katherine Menendez blocked the state's felony ban on July 27. The Connecticut ruling introduced a new legal theory: sports event contracts are not statutory "swaps" under the CEA, because they depend on event outcomes rather than whether an event occurs — directly conflicting with the Third Circuit's April ruling that they ARE swaps. New York escalated further: AG Letitia James and Governor Kathy Hochul filed a separate state lawsuit on July 31 seeking at least $36 billion in damages. The Second Circuit now holds two Kalshi appeals (NY + CT) that may be consolidated. Supreme Court review is increasingly likely. This page tracks every case in one place.
Every active case, newest development first
Filed criminal charges October 28, 2026 against Kalshi and co-founders Tarek Mansour and Luana Lopes Lara — 13 felonies and a misdemeanor, including a second-degree "pattern of unlawful criminal activity" count and 12 counts of online gambling promotion. Based on a September sting where an undercover agent placed 12 sports wagers verified to be in Utah.
A federal court in the Tenth Circuit ruled in August 2026 that federal commodities law does not preempt Utah's authority over Kalshi's sports contracts; Kalshi is appealing. The CFTC sued Utah on October 27 to block state enforcement — the tenth state the agency has taken to court.
Sent cease-and-desist letters September 18, 2026 to six prediction market operators — Kalshi, Polymarket, Robinhood, Crypto.com, Novig, and Underdog — alleging their sports event contracts constitute unlicensed sports wagering under Missouri law. The broadest single-state multi-platform enforcement action to date.
C&D required each operator to obtain a Missouri Gaming Commission license and pay the 10% wagering tax, or stop. Compliance window closed October 16-17. The Eighth Circuit (which covers Missouri) is already weighing the same preemption question in Kalshi's Iowa appeal.
Iowa moved to enforce state gambling law against Kalshi's sports event contracts. Kalshi sued for a preliminary injunction on CFTC-preemption grounds (KalshiEX LLC v. Bird).
Judge Stephen H. Locher (S.D. Iowa) denied Kalshi's preliminary injunction in September 2026, finding Kalshi unlikely to succeed on preemption. Kalshi filed an interlocutory appeal to the Eighth Circuit (No. 26-2874).
Ohio regulators sought to enforce state gambling laws against Kalshi's sports event contracts. Ohio district court sided with the state.
Kalshi appealed to the Sixth Circuit arguing CFTC preemption. The Sixth Circuit consolidated the Ohio and Tennessee appeals.
Tennessee regulators sought to enforce state gambling laws against Kalshi's sports event contracts.
Tennessee district court had sided with Kalshi at the preliminary injunction stage, finding CFTC preemption likely. Kalshi and Tennessee were consolidated into the same Sixth Circuit appeal as the Ohio case.
Sent Kalshi a cease-and-desist in 2025, alleging sports gambling without a state license. NY is the largest legal sports-betting market in the US.
CFTC sued New York in May 2026. Separately, Kalshi filed its own suit (KalshiEX LLC v. Williams) seeking a PI — denied July 7 by Judge Analisa Torres, who ruled the CEA does not preempt NY gambling law under field, conflict, or impossibility preemption. Kalshi appealed to the Second Circuit the same day.
Montana Gambling Control Division issued C&D letters to Kalshi (April 2026) alleging sports event contracts were unlicensed gambling under Montana law. Kalshi counter-sued in federal court.
Kalshi filed federal suit challenging Montana's C&D letters. Both sides reached a joint stipulation filed September 17, 2026: Kalshi dismissed its lawsuit; Montana agreed to pause all enforcement.
NGCB obtained a May 18, 2026 preliminary injunction requiring Kalshi to geofence sports, elections, and entertainment event contracts from Nevada users. Nevada Supreme Court denied Kalshi's bid to pause the order.
No CFTC suit filed in Nevada. Kalshi is contesting the injunction in Nevada state court while simultaneously facing contempt proceedings for alleged non-compliance.
Sued Kalshi alleging illegal online sports betting. Polymarket and Robinhood counter-sued seeking a preliminary injunction on CFTC-preemption grounds.
Polymarket/Robinhood PI DENIED June 19 by Judge Paul Maloney, who held sports event contracts are likely NOT swaps and that CFTC authority would intrude on traditional state regulation.
20 misdemeanor counts against Kalshi (March 2026) over election and sports contracts.
CFTC sued; TRO April 10; preliminary injunction May 5 (Judge Liburdi) on three independent preemption grounds: field, conflict, impossibility.
C&D notices issued December 2, 2025 to Kalshi, Robinhood, and Crypto.com for unlicensed sports wagering. Kalshi filed suit the following day seeking a preliminary injunction.
CFTC sued Connecticut in April 2026, arguing CEA preemption. Kalshi filed its own separate PI motion in December 2025.
Washington Gambling Commission sent Kalshi a notice that offering event-based contracts was not authorized under state law. Kalshi did not comply. AG sought and obtained a preliminary injunction.
No separate CFTC suit filed in Washington. McHale rejected Kalshi's CFTC-preemption argument directly. Injunction terms still being negotiated — both sides asked to submit a compliance plan by the first week of August.
SF 4760 signed May 19, 2026 — first state felony ban on prediction-market operators, effective August 1, 2026.
CFTC sued May 20 seeking preliminary injunction before the effective date. Kalshi and Polymarket US also filed separately.
Sued Kalshi (early June 2026) alleging its sports event contracts are unlicensed online sports betting. NM permits sports betting only at tribal casinos under state-tribal compacts.
CFTC sued New Mexico June 12. Polymarket filed its own independent federal suit July 1 seeking declaratory judgment and a preliminary injunction — after New Mexico rejected two requests to delay enforcement pending the Kalshi case.
State-court suits against Kalshi and Polymarket (May 26) alleging sports contracts are illegal sports betting; seeks disgorgement.
Kalshi counter-sued in federal court the same day; CFTC filed its own complaint May 29 plus a motion to intervene.
Sued Kalshi September 2025 — the first state in the country to sue a prediction market operator — alleging sports event contracts constitute unlicensed sports wagering under Massachusetts law.
CFTC filed amicus brief April 24, 2026 asserting exclusive federal jurisdiction over Kalshi's event contracts. A coalition of 38 state AGs filed an opposing amicus brief on April 28 supporting Massachusetts.
Executive order (May 2026) directing state agencies to pursue enforcement against prediction-market operators.
CFTC sued Illinois in April 2026 to block state enforcement.
Sued Kalshi, Polymarket, Robinhood, Crypto.com and Coinbase in state court (late April 2026) seeking permanent injunctions.
CFTC counter-sued Wisconsin in federal court April 28 to reaffirm exclusive jurisdiction.
Three things that decide how this ends
CFTC proposed prediction-markets rule published in the Federal Register June 12, 2026 — a 267-page NPRM that would permit most sports event contracts (scores, spreads, win-loss, stats) while banning single-play, injury, officiating, and pre-collegiate contracts. 45-day comment window closes July 27. A formal regulatory regime strengthens every preemption argument the agency is making in court.
President Trump posted public support for CFTC exclusive jurisdiction in late May 2026, reversing his April "casino" comment.
At least 15 state legislatures introduced prediction-market bills in 2026. Massachusetts and New Jersey have similar measures in committee, watching the litigation before moving. With district courts now split — Arizona for the CFTC, Michigan for the state — the first appellate ruling (the Sixth Circuit is positioned to move first after the June 19 Michigan decision) sets the template every other legislature follows or abandons.
Related reading
All prediction-markets news
Every development as it lands: court rulings, platform launches, regulatory shifts.
State guidesAll 50 state pages
Platform availability, tax treatment, and litigation status state by state.
ExplainerWhat is a DCM?
The federal license at the center of every case on this page.