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Arkansas Sues Kalshi as Federal Courts Leave State Gambling Enforcement in Place

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Arkansas Sues Kalshi as Federal Courts Leave State Gambling Enforcement in Place

Arkansas Attorney General Tim Griffin sued Kalshi Wednesday (Nov. 4), accusing the prediction market of offering illegal gambling to Arkansas residents, including customers too young to open electronic wagering accounts under state rules, according to a press release.

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The lawsuit comes as federal appeals courts have left Connecticut, Nevada and New York free to enforce their gambling laws against sports event contracts, adding to a series of setbacks for Kalshi and the federal regulator backing its position, Ars Technica reported Thursday (Nov. 5).

Griffin filed the civil case in Arkansas state court against KalshiEX LLC and Kalshi Inc, according to the release. He alleged they accepted wagers on sporting and entertainment events without the licenses or oversight required of gambling operators and failed to pay applicable taxes.

Kalshi admitted customers as young as 18, while Arkansas requires users to be at least 21 to open electronic wagering accounts, the Ars Technica report said.

Griffin alleged violations of Arkansas’ Deceptive Trade Practices Act and seeks restitution, penalties, unpaid taxes and an injunction, according to the release.

“Arkansas law is concerned with substance, not semantics,” Griffin said in the release. He pointed to Kalshi’s deposit limits, self-exclusion tools and promotion of gambling addiction resources as evidence that the company recognizes risks familiar to gambling regulators.

Kalshi called the allegations baseless and said Congress created a single federal regulator so exchanges could operate under nationwide rules, according to the Ars Technica report.


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