Michigan is the latest state to go on the offensive against Kalshi, suing the prediction markets platform in state court without first sending the operator any kind of enforcement notice.
Michigan Attorney General Dana Nessel filed a lawsuit in the 30th Judicial Circuit Court in Ingham County (pictured above) on Tuesday. Nessel’s office seeks a permanent injunction to stop Kalshi from offering sports event contracts in the Great Lakes State.
It makes Michigan just the second state to sue Kalshi without first attempting to push the company out of the state via other means such as a cease-and-desist order, and the third state to sue the predictions market operator in state court. Massachusetts did the same thing earlier this year, after Kalshi sued several other states including Nevada, New Jersey and Maryland upon receiving C&Ds.
The Michigan filing is the latest development in an evolving situation in courts across the U.S., as more states move to preemptively sue prediction market platforms as the plaintiffs, rather than first trying other approaches that may lead to them being sued as defendants.
Kalshi keeps adding sports, states Michigan
The heart of the lawsuit is the same as others involving Kalshi: State officials believe that Kalshi is offering event contracts on sports that are tantamount to sports wagering, despite Kalshi not holding a sports betting license in the state.
“Corporations cannot circumvent state gaming laws,” Nessel said in a public statement about the lawsuit. “My office will hold those who sidestep Michigan’s consumer protections accountable and ensure that betting in our state remains lawful, fair and subject to the oversight our residents expect and deserve.”
The lawsuit itself states that Kalshi offers “an online sports betting operation” to residents without the licensing approval of the Michigan Gaming Control Board.
“Specifically, Kalshi operates a so-called prediction market through which residents of the State of Michigan can engage in unlicensed gambling under the guise of trading event contracts,” it adds. “This market is an online trading platform through which users may wager on the likelihood of a sports-related occurrence. Kalshi conducts business across the United States, including within Michigan, where Kalshi makes its services available to residents, markets its platform to potential users, and accepts payments through widely used financial systems accessible by Michigan consumers.”
As other states such as Nevada have done, Nessel also emphasized that Kalshi has not only continued to offer sports event contracts but has expanded its suite of offerings available to players across the state.
“Kalshi keeps adding more,” stated Michigan, citing several examples including the availability of markets on non-major leagues such as the American Hockey League, the Swedish Hockey League, and college basketball in addition to points total markets on Detroit Pistons NBA games.
Kalshi and other prediction market platforms such as Crypto.com have maintained in court that their event contracts are allowable products under the Commodity Exchange Act (CEA) and continue to argue that the CEA and the federal regulation of the Commodity Futures Trading Commission (CFTC) supersede state gaming laws and license requirements.
Michigan warned operators last year
While Michigan did not follow other states by sending Kalshi or other prediction market platforms a C&D, as it has done to numerous offshore casinos, it has not been silent about the threats it believes sports event contracts pose.
As far back as April 2025, when sports prediction markets were still relatively new on the scene, the Michigan Gaming Control Board (MGCB) announced that it would launch a formal investigation into sites that offer such contracts, citing concerns over consumer protections and a supposed lack of market fairness. The same month, MGCB Executive Director Henry Williams wrote to the CFTC to highlight those reservations.
Then, in October, Williams sent letters to its licensed sportsbooks, brick-and-mortar casinos, iGaming operators and gaming suppliers warning them that “any involvement” in offering sports event contracts, whether direct or indirect, in-state or out of state, could jeopardize their gaming licenses.
Kalshi court cases hit double figures
Kalshi is now engaged in active litigation with 10 states, as well as tribal authorities in both California and Wisconsin. After Kalshi initially secured early wins in some of the first cases, a Nevada judge ultimately banned Kalshi and Crypto.com from operating in the Silver State and some other recent decisions have sided with states.
A judge granted Massachusetts Attorney General Andrea Joy Campbell a preliminary injunction in that case in state court, although Kalshi subsequently received a stay to halt the injunction temporarily.
In Nevada, the Ninth Circuit appeals court denied Kalshi an administrative stay after a federal court judge dissolved the preliminary injunction he granted to the company last year. As soon as Kalshi’s stay was denied, the Nevada Gaming Control Board sued that company and Polymarket in state court.
Earlier this week, a U.S. District Court for Nevada judge rejected the companies’ attempt to relocate the case to federal court, where prediction markets have had better results with their federal pre-emption argument. Michigan sued Kalshi in state court less than 24 hours after Nevada kept the NGCB’s lawsuit in state court.
