Louisiana Judge Orders Kalshi, Polymarket To Halt Event Contracts

A Louisiana state judge has ordered Kalshi, Polymarket, Robinhood and other prediction market platforms to stop offering event contracts in the state. 

Attorney General Liz Murrill announced the temporary restraining order on Thursday night, hours after her office filed a lawsuit arguing the platforms violate Louisiana gambling law.

Judge Jeffrey Johnson of Tangipahoa Parish signed the order, which bars the companies from facilitating event contracts on behalf of anyone located in Louisiana, according to a copy Murrill posted on X, as NOLA.com reported. 

A restraining order is a short-term measure and is not a ruling on the merits of the case.

The State's Argument

Murrill's lawsuit contends that event contracts are the same as wagers and must be regulated by the state. 

After the judge acted, she said prediction markets are gambling and that companies cannot rename an activity to escape state gambling laws. 

Her position is that an operator without a Louisiana gaming licence is not legal, and that illegal gambling is a crime carrying possible jail time and significant penalties. 

She added that judges around the country have overwhelmingly treated this activity as gambling.

The companies argue the opposite, that event contracts are financial products traded on federally regulated exchanges and so fall under federal rather than state rules.

Kalshi's Response

Before the order became public, Kalshi's head of litigation, Jovy Dedaj, posted on X that operating federally regulated exchanges is the exclusive province of the federal government. 

Dedaj also said Kalshi has been hit with anticompetitive litigation designed to take that choice away from customers. Kalshi and Polymarket had not responded to requests for comment when NOLA.com published its article.

As of 7pm. on Thursday, Kalshi users in Louisiana could still buy into an event contract on the platform, so it was unclear how quickly the order would take effect in practice.

A Parallel Federal Fight

The state case follows a federal one. Two weeks ago Kalshi sued the attorney general and other Louisiana officials in federal court, arguing the state has no authority to regulate its service. 

On Thursday Kalshi asked that court for its own restraining order against Murrill and others. A judge had not ruled on that request when NOLA.com published, which leaves two courts holding overlapping questions on the same dispute.

Louisiana is one of a growing number of states in conflict with the industry. More than a dozen states have taken legal action against Kalshi, Polymarket and other prediction market companies. 

Washington Attorney General Nick Brown sued Kalshi in March, arguing it violated the state's gambling and consumer protection laws. Utah brought a civil suit and also filed 14 criminal charges against the platform and its leadership after an undercover investigation. 

We covered a similar order in Washington, where a judge ordered Kalshi to halt sports and election contracts.

The sources reviewed did not give a hearing date for any longer injunction. Until the order is lifted or replaced it stands against the named platforms, and the federal court's decision on Kalshi's own request is the other development to watch.