- New York AG Letitia James, alongside Governor Kathy Hochul, announced a lawsuit against KalshiEX, LLC (Kalshi), alleging an investigation by her office concluded the company is running an illegal, unlicensed gambling operation in New York through its prediction market platform that exposes New Yorkers to serious and financial risk.
- The lawsuit alleges that Kalshi’s prediction markets meet the legal definition of gambling because the outcomes of the events on which its users are betting are uncertain and outside of the control of the better or hinge on a game of chance. Currently, Kalshi does not have a license from the New York State Gaming Commission, and thus the company is able to avoid paying taxes like licensed casinos and mobile sports gaming platforms do. Additionally, Kalshi’s prediction market is available to users who are between the ages of 18-20 despite New York law that requires a person to be at least 21 years or older to participate in mobile sports betting. New York’s lawsuit is seeking a court order to stop Kalshi from operating as an unlicensed gambling business and requiring the company to pay fines, forfeit all illegal gains, and pay restitution to users.
- Separately, in Utah, AG Derek Brown announced that a federal judge has ruled that Utah’s anti-gambling laws apply to Kalshi’s sport betting contracts and granted summary judgement to Utah in the lawsuit Kalshi filed in February, in which Kalshi had argued that, because it operates a federally registered exchange regulated by federal commodities law, Utah could not treat its sports bets as gambling.