Connecticut sues Kalshi over sports betting and underage claims

Connecticut sues Kalshi over alleged unlicensed sports betting and underage promotion, seeking injunctions and revenue disgorgement. Kalshi claims federal regulation applies.

Connecticut has filed a lawsuit against Kalshi, seeking to stop the platform from offering sports-related event contracts, which state officials allege are unlicensed sports wagers. The complaint, filed in Hartford Superior Court, claims Kalshi allowed individuals under 21 to place bets and temporarily hired a 15-year-old as a promotional affiliate. The state is pursuing both temporary and permanent injunctions, as well as disgorgement of all revenue earned from Connecticut residents. Alternatively, it seeks payment of taxes and fees equivalent to those required of licensed operators. Officials argue that Kalshi's activities put consumers, minors, and those with gambling addictions at risk. Connecticut maintains that federal regulation does not exempt Kalshi from state gambling laws. Kalshi, however, asserts its products are federally regulated derivatives and accuses the state of arbitrary enforcement and unequal treatment compared to other prediction markets. This dispute reflects broader regulatory tensions and follows similar actions in other states and a recent federal court ruling against Kalshi.