States Escalate Challenges to Kalshi Contracts

New York and Louisiana are challenging Kalshi’s sports prediction contracts, disputing its claim that federal regulation shields them from state gambling laws. Kalshi sued Louisiana officials, arguing its federal license is sufficient, while Louisiana says the company must obtain a gambling license; the state’s strengthened penalties target operators, not necessarily users. In New York, the Gaming Commission has asked a Manhattan court to compel Kalshi to comply with investigative subpoenas issued in July, saying the company has failed to provide key records or given inadequate responses. The requested records cover sports-event contracts, offerings to people under 21, marketing, transactions, and Kalshi’s ownership and corporate structure; the commission says it needs them to investigate possible violations and assess civil penalties, alleging unlicensed sports wagering for at least 18 months. New York courts have so far declined to block the state’s broader enforcement efforts, but the subpoena petition’s allegations have not been tested in court, and the larger dispute over state gambling authority versus federal oversight may ultimately require a higher-court decision.