TLDR
- A Michigan court issued a preliminary injunction ordering Kalshi to stop offering sports betting markets in the state.
- Judge Rosemarie E. Aquilina ruled the platform’s operations pose immediate harm to youth and vulnerable residents.
- Kalshi allowed users as young as 18 to trade, below Michigan’s legal gambling age of 21.
- The order requires Kalshi to use a licensed geolocation provider to block Michigan users.
- Kalshi faces a fine of $500,000 per day if it fails to comply with the geofencing rules.
A Michigan court has ordered Kalshi to stop offering sports betting markets to residents of the state.
The preliminary injunction came from Judge Rosemarie E. Aquilina of the Ingham County Circuit Court. It blocks Kalshi from offering or facilitating sports wagers to anyone located in Michigan.
The ruling follows a lawsuit filed by Michigan Attorney General Dana Nessel. She accused Kalshi of running an unlicensed sports betting business disguised as event contract trading.
Nessel said in a press release that Kalshi tried to pass itself off as a legitimate gaming operation. She called the company’s practices predatory and unlicensed.
Background on the Case
The injunction is the latest step in a legal fight that started in March. Nessel first sued Kalshi for alleged violations of Michigan’s Lawful Sports Betting Act.
In June, Nessel secured a temporary restraining order against Kalshi. That order briefly stopped the company from advertising or running its sports betting operation in Michigan.
The new preliminary injunction extends that earlier order. It will stay in place until the court reaches a final judgment in the case.
Why the Judge Ruled Against Kalshi
Judge Aquilina wrote that Michigan residents, including some of the state’s most vulnerable people, faced ongoing harm from Kalshi’s platform. She said the harm would continue without the injunction.
One issue was age limits. Michigan law sets the legal gambling age at 21, but Kalshi let users as young as 18 place trades.
The judge warned that letting Kalshi keep operating could cause deep harm to Michigan’s youth.
The order also said Kalshi takes advantage of mental health struggles without offering the safeguards built into Michigan’s regulatory system. It added that the company avoids the consumer protections licensed gambling operators must follow.
Aquilina also pointed to funding. She said Kalshi’s activity threatens money that legal gaming generates for schools, gambling addiction programs, economic development and first responders.
The court’s order goes beyond a simple stop order. It lays out specific rules for what Kalshi can and cannot do in Michigan.
Kalshi is barred from offering, listing or settling any contract that counts as sports betting under state law. This applies to anyone located in Michigan or using platforms accessible there.
The company also cannot accept deposits tied to sports betting contracts from Michigan users. It is barred from advertising sports betting products through websites, apps, email, social media or affiliates targeting the state.
The order blocks Kalshi from creating or maintaining accounts for the purpose of trading sports betting products in Michigan. It also bans products that function like sports betting, including parlays, moneyline wagers, prop bets and in-game betting.
Enforcement and Penalties
To enforce the ban, Kalshi must use a third-party geolocation provider licensed by the Michigan Gaming Control Board. That provider must meet the board’s geofencing standards.
If the court finds Kalshi failed to meet these geolocation requirements, the company must pay $500,000 for every day it remains out of compliance.
The case is ongoing, and the injunction will remain in force until a final ruling is issued.
