Prediction market platform Kalshi faces a lawsuit from Washington state, alleging its products violate state gambling laws. The complaint follows similar legal actions in Nevada and Arizona, where authorities argue the company operates an unlicensed gambling business. Kalshi has sought to move the Washington case to federal court, stating the issues are already being litigated elsewhere.
The state of Washington has filed a lawsuit against prediction market operator Kalshi, alleging it violated state gambling laws. According to an announcement from Attorney General Nick Brown, the complaint cites violations of the Washington Consumer Protection Act, Gambling Act, and Recovery of Money Lost at Gambling Act.
“Kalshi’s website and app show consumers a range of events that they can bet on and the odds for those various events, which dictate how much the bettor will be paid out if the event occurs,” the announcement stated. The state argues Kalshi’s activities meet the legal definition of gambling as staking something of value on a future contingent event.
Kalshi immediately sought to move the case to federal court. In its filing, the company said the issues are already being litigated in other federal courts and claimed there had been “no warning or dialogue” from Washington state prior to the lawsuit.
This action is part of a broader multi-state legal challenge. A Nevada judge recently issued a temporary restraining order blocking Kalshi from operating in that state. The judge sided with the Nevada Gaming Control Board’s motion, finding state authorities are reasonably likely to prevail.
Days earlier, Arizona Attorney General Kris Mayes announced criminal charges against the companies behind Kalshi. The charges allege the company operated an illegal gambling business in Arizona without a license and offered illegal election wagering. These state-level cases come as prediction markets face scrutiny from lawmakers for offering bets on sensitive topics like U.S. military actions.
