Underdog sues Missouri over regulation of prediction markets
The company asks a federal court to find the Commodity Exchange Act overrides Missouri rules
Key Takeaways
- Underdog Exchange and Underdog Predict filed a federal suit in the Western District of Missouri on 8 November 2026.
- The company argues the federal Commodity Exchange Act governs its event-linked contracts and preempts Missouri state gaming rules.
- The defendants are Missouri Attorney General Catherine Hanaway and officials of the Missouri Gaming Commission.
- The CFTC issued a 5 November interpretation requiring exchanges not to exclude U.S. traders and gave 30 days to remove incompatible restrictions.
- Underdog also requested a preliminary injunction from Judge Beth Phillips to prevent enforcement while the case proceeds.
Underdog filed a federal lawsuit on 8 November 2026 against the state of Missouri to stop it from treating its event-linked contracts as sports betting. The suit was brought by Underdog Exchange and Underdog Predict in the U.S. District Court for the Western District of Missouri, asking the court to find that the federal statute governing commodities prevails and to grant a permanent injunction.
What Underdog claims
Underdog says contracts tied to events, including sporting-event results, are governed by the federal Commodity Exchange Act and not by Missouri's state gaming rules. The lawsuit names Missouri Attorney General Catherine Hanaway and officials at the Missouri Gaming Commission as defendants. The two companies ask the court to declare that state enforcement is preempted by federal law and to issue a permanent injunction. [Commodity Exchange Act](/regulation) is central to the claim, and Underdog argues state action would conflict with federal authority.
Timeline and prior steps
The dispute began with a letter from the Attorney General's office to Underdog Sports Wagering LLC dated 17 September, offering two options: cease operations or obtain a state license and comply with tax and age-verification rules. Underdog previously filed suits against officials in Massachusetts, New Mexico, Ohio, Washington and Wisconsin on 8 September. Missouri had extended an initial compliance deadline to 30 October, and the Attorney General's office said enforcement would begin three days later, on 6 November.
Recent federal regulatory development
On 5 November the Commodity Futures Trading Commission issued an interpretation stating that exchanges may not exclude U.S. traders from market access provided they meet other applicable requirements. The CFTC gave exchanges 30 days to remove incompatible restrictions or explain why they could not do so. Underdog contends that pulling back from Missouri could violate federal law and disrupt customer positions already open; under the state's policy, traveling users cannot open new positions or withdraw funds, though existing positions remain on the market.
Request for provisional relief
In addition to the main complaint, Underdog asked Judge Beth Phillips on 8 November for a preliminary injunction to bar Missouri from carrying out enforcement actions until the case is decided. The state must respond to that petition by 23 November unless the court sets a different date.
Frequently Asked Questions
What does Underdog allege in its lawsuit against Missouri?
Underdog alleges that the federal Commodity Exchange Act preempts Missouri's state gaming regulations and therefore state enforcement is barred; it asks the court to declare federal preemption and to issue a permanent injunction. The suit was filed by Underdog Exchange and Underdog Predict on 8 November 2026 in the U.S. District Court for the Western District of Missouri.
Who are the defendants in the legal action?
The defendants are Missouri Attorney General Catherine Hanaway and officials of the Missouri Gaming Commission. The plaintiffs are Underdog Exchange and Underdog Predict; the dispute traces to a letter addressed to Underdog Sports Wagering LLC dated 17 September.
What provisional relief did Underdog request?
On 8 November Underdog asked Judge Beth Phillips for a preliminary injunction to prevent Missouri from enforcing its actions until the case is resolved. The state must respond to that petition by 23 November unless the court sets another date.
What did the CFTC say and how does it affect the case?
The Commodity Futures Trading Commission said on 5 November that exchanges cannot exclude U.S. traders if they meet other applicable requirements, and it gave exchanges 30 days to remove incompatible restrictions. Underdog argues that restricting access for Missouri users could violate federal law and disrupt customers' open positions.
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About the author
Renata Quiroga
Betting Markets Correspondent
Renata Quiroga covers sports betting and prediction markets — sportsbook launches, odds technology, event contracts, and the regulatory calls that decide what can be bet on and where. The reports open with the product or the ruling, name operators and platforms precisely, and explain the mechanics without needless jargon. When a book enters a Latin American market or a prediction exchange lists a contested contract, Renata Quiroga reports what changes for the bettor.
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