Utah Attorney General Derek Brown filed suit against Kalshi on October 20, seeking to stop its operations in the state. The state says its yes/no event contracts are indistinguishable from bets at a traditional sportsbook.
The complaint calls the company 'the manager of a back-alley gambling den' and labels its activity a public nuisance. It seeks disgorgement of profits and restitution for harm dating to at least September 2024. Brown estimates 'illegal bets' from Utah accounts at $30,591,600 to $61,183,200. Losses stand at about $5.5 million.
Kalshi says it is a federally regulated financial exchange, 'like the stock market'. 'Kalshi is subject to federal law, and no single state should have veto over it,' the company said. Utah cites a recent federal court decision rejecting KalshiEx's argument that state laws do not bind it. The clash is federal versus state law.
Brown also urged other companies operating in Utah to read the suit and comply with the law. The suit notes sports betting and other gambling are banned in the state. Kalshi has offered such contracts to Utah residents since at least September 2024 and continues to do so.
