Connecticut sues Kalshi over sports event contracts in months-long legal feud

Connecticut has sued Kalshi to block the platform from offering sports-related event contracts, escalating the state's months-long legal fight against the prediction markets platform.

In a statement released Wednesday, Connecticut Attorney General William Tong said the state is seeking a court injunction requiring it to cease offering what it identifies as unlicensed sports wagers.

"Sports event contracts are no different than sports betting and are not magically shielded by federal law from Connecticut's commonsense consumer protection laws," said Tong. 

Connecticut Governor Ned Lamont said that Kalshi's prediction markets put the state's consumers and young people at serious risk.

"When we legalized sports wagering in 2021, the goal was to create a safe, responsibly regulated market for Connecticut consumers, not to open a free-for-all on sports betting," Lamont added.

Jovy Dedaj, Kalshi's head of litigation, wrote in a post on X that Connecticut's move is "the latest in a line of arbitrary and inconsistent enforcement," as the state is "okay with other prediction markets operating there in the meantime."

"This unequal treatment is exactly why federal oversight is necessary," said Dedaj.

The Block has reached out to Kalshi for further comment.

Legal battle

The case is Connecticut's latest move in its months-long fight with Kalshi. 

In December 2025, Connecticut's Department of Consumer Protection ordered Kalshi, Robinhood, and Crypto.com to stop promoting and offering sports event contracts.

Kalshi fought back by filing a lawsuit against state officials the following day, arguing that its markets — which allow users to trade on outcomes of future events — are regulated derivatives products overseen by the Commodity Futures Trading Commission. 

Because the CFTC granted Kalshi designated contract market status in 2020, the company claims that Connecticut's gambling laws do not apply and that the state is overstepping its authority.

Earlier this month, Judge Vernon Oliver denied Kalshi's motion for preliminary injunction against state enforcement. The company has since appealed the decision to the Second Circuit.

Separately, in April, the CFTC sued Connecticut, Arizona, and Illinois, arguing that the states can't outlaw CFTC-registered designated contract markets. 

"The CFTC will continue to safeguard its exclusive regulatory authority over these markets and defend market participants against overzealous state regulators," CFTC Chair Michael Selig said at the time.

Nationwide

Connecticut is among more than a dozen states that have taken enforcement action or filed lawsuits against Kalshi over its sports event contracts.

Earlier this month, a Washington court ordered Kalshi to stop offering prediction markets related to sports, elections, politics, entertainment, culture, technology and science in the state.

Also this month, Baltimore, the most populous city in Maryland, sued Kalshi and Polymarket, alleging that their sports-event contracts amount to illegal gambling.