- A federal judge ruled that Utah can enforce their anti-gambling laws against Kalshi.
- The prediction market operator argued that they can offer sports event contracts without state intervention due to their federal regulation, but that argument was rejected.
- Kalshi disagrees with the decision and will appeal, but the case is now closed.
SALT LAKE CITY– Utah can enforce their anti-gambling laws against Kalshi, a federal judge in Utah ruled on Tuesday. The judge rejects Kalshi’s argument that federal regulation includes their sports event contracts and prevents state intervention.
Judge Rules Against Kalshi In Utah
In simple terms, Kalshi argued that they can offer sport event outcomes in Utah and other states because of their position as a federally-regulated prediction market under the Commodity Futures Trading Commission (CFTC). The court decided that Kalshi is not immune to state jurisdiction and outright ban.
Some examples of those sport event trades offered by Kalshi include a player to hit a home run or the Utah Jazz to defeat the Portland Trailblazers. These “sports event contracts” are rebranded versions of sports betting, which the state deems a third-degree felony under Utah anti-gambling laws.
According to a release from Utah Attorney General Derek Brown, “You can’t rebrand illegal gambling as a federal commodity, and today a federal judge agreed with us. Kalshi bet that clever branding would beat Utah law. Kalshi lost and Utah won.” AG Brown added that “Utah’s constitution bans gambling to protect Utah families, and my office will enforce that ban. Gambling is gambling no matter what any company calls it.”
The state’s constitution bans gambling in all forms, including Utah sports betting, casino gambling, and lottery. This gambling regulation has been in the state’s power since the 1800s, which U.S. District Judge Robert J. Shelby remined Kalshi of in the ruling.
The state’s position against Kalshi’s sports event contracts is supported by 23 federally-recognized tribes and gaming associations. The case has been ordered close after being granted summary judgement for the state of Utah.
