Utah sues Kalshi for millions after federal ruling
State seeks to block event contracts and recover tens of millions from the prediction market
Key Takeaways
- Attorney General Derek Brown filed the suit against Kalshi on October 22, 2026 in Utah state court.
- The complaint seeks to block Kalshi’s event contracts in Utah, require court‑approved geolocation controls and disgorge between $30,600,000 and $61,200,000.
- More than 32,000 Utah residents had verified accounts on Kalshi as of February, according to the filing.
- Kalshi contends the Commodity Futures Trading Commission has exclusive federal jurisdiction over its event contracts.
The State of Utah sued Kalshi on October 22, 2026 to stop the prediction-market operator from offering contracts on sport and other events within the state, and to recover tens of millions that the complaint says the platform collected through illegal wagering. The suit was filed by Attorney General Derek Brown in state court after a federal ruling in August rejected Kalshi’s bid to avoid Utah gambling laws.
What Utah is seeking
The court filing asks Kalshi to withdraw its event-contract offerings from the state, put in place court‑approved geolocation controls, and disgorge profits that Utah deems illicit. The complaint alleges Kalshi collected between $30,600,000 and $61,200,000 in fees from Utah customers. More than 32,000 Utah residents had verified accounts on the platform as of February, according to the complaint.
“Utah has said no to gambling since its founding in 1896, and that didn’t change when betting moved to phones,” Derek Brown said at a Tuesday press conference.
Named parties and Kalshi’s argument
The complaint names several Kalshi affiliates and the trading firms Susquehanna International Group and Susquehanna Government Products as defendants. Kalshi argues that the Commodity Futures Trading Commission has exclusive jurisdiction over its event contracts as federally regulated financial derivatives. A company spokesperson said:
“As a national derivatives market supervised by the CFTC, Kalshi answers to federal law, and no state should have a veto over that,” the spokesperson said.
Procedural history and judicial context
In August a federal court found that Utah’s gambling laws were not preempted by federal commodities law. Kalshi appealed to the 10th Circuit, which denied its request for an injunction while the appeal proceeds. Federal courts are split: the Third Circuit ruled for Kalshi in the New Jersey case, while the Sixth Circuit rejected its arguments in Ohio and Tennessee cases. New Jersey has asked the U.S. Supreme Court to resolve the dispute.
Frequently Asked Questions
What does Utah want from Kalshi in the lawsuit?
Utah asks the court to stop Kalshi from offering event contracts in the state, mandate court‑approved geolocation controls, and force the company to hand over revenues the state considers illicit. The complaint quantifies those alleged takings at between $30.6 million and $61.2 million.
What is Kalshi’s regulatory defense?
Kalshi argues that its event contracts are federally regulated derivatives under the Commodity Futures Trading Commission’s oversight, and therefore subject to exclusive federal jurisdiction. A company spokesperson said the platform answers to federal law and states should not be able to veto that supervision.
What federal decisions matter to this case?
In August a federal court held that Utah’s gambling laws were not preempted by federal commodities law; Kalshi appealed to the 10th Circuit, which denied an injunction pending appeal. Federal courts are split, with the Third Circuit siding with Kalshi in New Jersey and the Sixth Circuit ruling against Kalshi in Ohio and Tennessee.
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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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