Utah Sues Kalshi Over Event Contracts

Utah’s Attorney General has filed a lawsuit against prediction market operator Kalshi and two Susquehanna-affiliated trading firms, alleging violations of state gambling laws. The complaint was submitted to the Third District Court of Utah on 20 October and seeks $61.2 million in damages, alongside additional financial remedies and court-ordered restrictions.

The state is asking the court to prevent Kalshi from offering sports- and politics-related event contracts to Utah residents and to stop the company from retaining profits generated through the allegedly unlawful transactions.

According to the complaint, users in Utah traded approximately $3 billion through Kalshi. The state estimates that the activity generated between $30.6 million and $61.2 million in fees for the company.

Kalshi Challenges Utah’s Gambling Claims

Kalshi disputes the state’s position, arguing that it operates under a licence from the Commodity Futures Trading Commission (CFTC) and should not be classified as a gambling business.

A company spokesperson said Kalshi is regulated by the CFTC and that its customers trade against one another, with contract prices determined through trading activity.

The case centres on the extent to which individual states can enforce their gambling laws against event contracts offered by federally regulated prediction markets.

Earlier Court Ruling Supports State Enforcement

The latest complaint follows an August decision by US District Judge Robert J. Shelby in Utah’s legal dispute with Kalshi.

Shelby ruled that the Commodity Exchange Act (CEA) does not prevent Utah from applying its own gambling regulations to Kalshi’s sports-related event contracts.

That decision challenged Kalshi’s position that federal oversight protects its products from state-level gambling enforcement. The new proceedings will continue the dispute over the relationship between federal regulation of prediction markets and state authority over gambling.