Kalshi Sues Over Louisiana's Interpretation of the Law

Prediction market platform Kalshi has filed a federal lawsuit in the United States District Court for the Western District of Louisiana to stop the state from applying its gambling laws to its operations. The company argues that the state is treating prediction markets as illegal gambling and that it has no authority to do so.

The lawsuit targets House Bill 53 and House Bill 883, which were signed in May and take effect on August 1, 2026. Kalshi says the state is using these laws to classify sports event contracts as illegal gambling. According to the company, regulating such contracts is a federal matter, and state laws cannot extend into that field.

The company filed its complaint with the court on October 23, 2026. To prevent possible enforcement action, Kalshi is seeking a temporary restraining order, along with a preliminary and permanent injunction. The case will be heard within the jurisdiction of the Fifth Circuit Court of Appeals.

The Louisiana administration has clearly stated its view that sports event markets should be considered gambling. Although the state says the main target of the law is unlicensed online casinos, betting sites, and sweepstakes platforms, Kalshi is concerned that the law's wording could be used against its own activities.

In its lawsuit, Kalshi relies on the Commodity Exchange Act and its regulation by the Commodity Futures Trading Commission. The company argues that complying with Louisiana's licensing requirements is incompatible with the federal regulatory framework.