TLDR
- Kalshi filed a pre-emptive federal lawsuit against Louisiana officials on Friday.
- The company wants a court order blocking enforcement against its sports event contracts.
- Defendants include Governor Jeff Landry and Attorney General Liz Murrill.
- Kalshi argues federal law, through the CFTC, overrides Louisiana gambling rules.
- The case is the first prediction markets lawsuit in the Fifth Circuit.
Prediction market company Kalshi has filed a lawsuit against Louisiana officials in federal court. The company wants to stop the state from taking action against its sports event contracts.
The suit was filed on Friday in the US District Court for the Western District of Louisiana. Kalshi says state officials showed a “clear intention to violate the Supremacy Clause” by trying to shut down prediction markets.
The defendants include Attorney General Liz Murrill and Gov. Jeff Landry. Louisiana Gaming Control Board Chair Christopher Hebert, Gaming Division Director Dawn Himel, and the Louisiana State Police Gaming Enforcement Division are also named.
Kalshi is asking for a temporary restraining order, as well as preliminary and permanent injunctions. The case brings prediction markets litigation into the Fifth Circuit for the first time.
Louisiana Warnings and New Gambling Laws
Kalshi pointed to public statements, court filings, and enforcement efforts since late last year. The company said these show officials “will imminently bring an enforcement action” to bar it from offering event contracts.
One exhibit is a December 2025 letter from Hebert to licensed sportsbooks. It warned that offering sports prediction markets breaks state law and could affect their gaming licenses.
“It is the board’s position that such activities constitute sports wagering under Louisiana law,” Hebert wrote. He also noted that state law treats “exchange wagering” as sports wagering.
The complaint also cited House Bills 53 and 883. Gov. Landry signed both in May, and they took effect on August 1, 2026.
HB 883 widened the definition of “gambling by computer” and made dual-currency sweepstakes and social gaming platforms illegal. HB 53, also called Act 48, turned several gambling crimes into racketeering offenses with penalties of up to 50 years in prison.
The laws mainly target illegal casinos, sportsbooks, and sweepstakes sites. However, courts could shut down websites and freeze the assets of operators and related companies, including payment processors and media affiliates.
Kalshi Says Federal Law Comes First
Kalshi is regulated by the Commodity Futures Trading Commission. The company says Louisiana treats its contracts as unlicensed gambling, even though the law exempts futures and similar instruments traded on an exchange.
Kalshi said the state has in effect threatened to ban it. It also said that even with a state license, Louisiana’s rules would be “impossible to reconcile” with the Commodity Exchange Act.
“The Supremacy Clause does not tolerate that result,” Kalshi said. The company added that it “has no option but to seek judicial relief” because officials have given no assurance they will hold off.
In Louisiana, Kalshi is relying on an argument called field preemption. In Nevada last year, it won early rulings on a related argument, but the Ninth Circuit rejected that position in September.
Other states are also pushing back. This month, Utah sued Kalshi to ban its sports, politics, and mention markets.
“Kalshi bet that Utah wouldn’t use its gambling laws,” Utah’s Attorney General said. “Kalshi lost that bet.”
In Illinois, Judge Martha Pacold ruled earlier this month that Kalshi and Coinbase answer to the CFTC, not the state gaming commission. Kalshi called that ruling “beautiful.”
The Louisiana court has not yet ruled on Kalshi’s request for a temporary restraining order.
