Utah Attorney General Derek Brown filed a lawsuit Tuesday targeting prediction market platform Kalshi, its subsidiaries, and two partner trading firms. The legal action accuses the companies of violating state anti-gambling laws by operating what the filing characterizes as a back-alley gambling den that collects fees on wagers placed by local residents.
The state is asking the court to permanently block Kalshi from offering wagers in Utah and mandates the implementation of a court-approved geolocation service to keep residents off the platform. Furthermore, Utah is seeking to recover an estimated $30.6 million to $61.2 million in fees allegedly amassed from unauthorized wagers placed within the state.
At the center of the ongoing dispute is whether event contracts on prediction markets constitute federally regulated financial products or standard gambling subject to state laws. While platforms like Kalshi argue their contracts fall under federal oversight, state regulators increasingly push back, contending that event contracts closely mirror traditional sports betting and wagering.
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