Michigan Attorney General Dana Nessel has secured a preliminary injunction against Kalshi, barring the prediction market company from offering sports contracts in Michigan.
The order requires Kalshi to maintain geofencing that prevents Michigan residents and anyone within the state from accessing its sports contracts. Violating the order could result in a $500,000 daily fine.
“Kalshi long attempted to pass itself off as a legitimate gaming operation in our state, and I am relieved that this order further protects Michigan residents from its predatory, unlicensed practices,” said Nessel. “My office will continue to defend Michiganders and enforce our gaming laws, which ensure gambling revenue is regulated and distributed back into our communities.”
Nessel filed a lawsuit against Kalshi in March, alleging that the company violated Michigan’s Lawful Sports Betting Act (LSBA) by offering sports betting through event contracts without approval from the Michigan Gaming Control Board (MGCB).
According to the lawsuit, Kalshi operates an online platform that allows Michigan residents to wager on sports-related outcomes under the guise of trading event contracts. The Attorney General’s office alleges that the activity constitutes unlicensed gambling under Michigan law.
Kalshi subsequently sought to move the case from state court to the US District Court for the Western District of Michigan. Nessel filed a motion to remand the case, which was granted, returning the lawsuit to the Ingham County Circuit Court.
An Ingham County judge sided with Michigan in June, issuing a temporary restraining order that prevented Kalshi from offering sports-related contracts in the state as the legal dispute continued. The restriction lasted until mid-July.
MGCB subsequently ended its membership in the National Council on Problem Gambling in July. The move followed the nonprofit’s acceptance of a $2 million partnership with Kalshi earlier in the year.
In a letter to the council, MGCB Executive Director Henry Williams said the deal was inconsistent with Michigan’s efforts to curb what state officials describe as ‘unlicensed’ and ‘illegal’ sports betting.
Williams further questioned Kalshi’s positioning of its contracts as “investments” instead of gambling products, saying it could conflict with responsible gambling initiatives and create uncertainty for consumers over the safeguards that apply.
Kalshi has said it will contest the state’s case.
The company said in July that it disagreed with Michigan’s position and would defend itself in court, maintaining that it is subject to exclusive federal jurisdiction.