Kalshi’s regulatory legal grapple extends to Maryland
The company filed a lawsuit after receiving a cease-and-desist order from the MLGCC.
Key Points
- Several states have sent the company similar letters
- Kalshi has sued two other state regulators
Prediction market provider Kalshi has filed a temporary restraining order and preliminary injunction against the Maryland Lottery and Gaming Control Commission (MLGCC), following a recently issued cease-and-desist order.
This is the latest in a series of legal suits against state regulators. Kalshi alleges the MLGCC is “unconstitutionally threatening to prohibit trading of Plaintiff KalshiEX LLC’s (Kalshi) sports-event contracts in Maryland.”
The Maryland regulator sent the letter earlier in the month, claiming Kalshi does not hold proper licensing in the state to conduct activities.
Maryland Lottery and Gaming Control agency director John Martin wrote in the cease-and-desist order, “Kalshi is operating in Maryland and is offering and conducting what is, in fact, wagering on sporting events.
“However, Kalshi does not hold a sports wagering license issued by the Commission, its wagers have not been approved by the Commission, and it is not otherwise authorized under Maryland law to offer wagers on sporting events.”
The company is currently in litigation with two other state regulators in Nevada and New Jersey.
Both issued similar cease-and-desist orders, which resulted in lawsuits.
In New Jersey, regulator cited prediction market platform Kalshi and Robinhood, a financial platform, claiming both companies were offering “unauthorized sports wagering” to New Jersey players.
Both companies were given a Friday deadline for compliance, according to the local report.
The department of gaming enforcement has requested for any bets placed by residents in the Garden State to be voided.
According to the letter, Kalshi violated state law by allowing wagers on New Jersey college teams or sporting events held in the state. For this year’s tournament, the City of Newark is hosting the East Regional.
Kalshi recently partnered with Robinhood to offer players sport event trading on March Madness.
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