Michigan AG Sues Kalshi Over Alleged Online Sports Betting Violation

Lawsuit claims prediction market operator offered unauthorized sports betting to Michigan residents

Published on Mar. 6, 2026

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Michigan Attorney General Dana Nessel has filed a lawsuit against prediction market operator Kalshi, alleging the company violated the state's Lawful Sports Betting Act by offering online sports betting to Michigan residents without authorization from the Michigan Gaming Control Board.

Why it matters

This case highlights the ongoing legal battles between states and emerging financial technology companies over the boundaries of regulated gambling and unregulated prediction markets. Michigan is seeking to protect its consumer protections and oversight of the sports betting industry within the state.

The details

The lawsuit, filed in the 30th Judicial Circuit Court, claims that Kalshi's "event contracts" are essentially illegal sports bets, exposing Michigan residents to potential gambling addiction without the required responsible gambling features and oversight from the Michigan Gaming Control Board.

  • The Lawful Sports Betting Act went into effect in Michigan in December 2019.
  • Online sports betting was legalized in Michigan in January 2021.

The players

Dana Nessel

The Attorney General of Michigan who filed the lawsuit against Kalshi.

Kalshi

A prediction market operator that the Michigan Attorney General alleges offered unauthorized online sports betting to Michigan residents.

Michigan Gaming Control Board

The state regulatory body that oversees legal sports betting in Michigan and which Kalshi is accused of sidestepping.

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What they’re saying

“By virtue of offering its internet sports betting operation to Michigan residents, Kalshi induces a person to reasonably believe that its internet sports betting operation is legal in the State of Michigan when in fact such conduct is illegal.”

— Dana Nessel, Michigan Attorney General (cbsnews.com)

“Corporations cannot circumvent state gaming laws. My office will hold those who sidestep Michigan's consumer protections accountable and ensure that betting in our state remains lawful, fair and subject to the oversight our residents expect and deserve.”

— Dana Nessel, Michigan Attorney General (cbsnews.com)

What’s next

The court will decide whether to issue a permanent injunction against Kalshi, prohibiting the company from offering any alleged online sports betting in Michigan.

The takeaway

This lawsuit highlights the ongoing tension between emerging financial technology companies and state governments over the regulation of new forms of gambling and betting. Michigan is seeking to protect its consumer protections and oversight of the sports betting industry within the state.