Novig Sues Missouri Over Sports Event Contracts
Novig has taken Missouri to federal court. The prediction market exchange filed suit on October 16, 2026, one day before a state deadline to stop offering sports event contracts to Missourians or apply for a state licence. It is the latest in a run of Novig lawsuits against states.
The plaintiff is Ludlow Exchange, LLC, trading as Novig. According to its complaint in the U.S. District Court for the Eastern District of Missouri (case No. 4:26-cv-01780), it is suing Attorney General Catherine Hanaway, Missouri Gaming Commission executive director Michael Lear and commission chair Jan Zimmerman in their official capacities.
What Missouri Told Novig
Hanaway's office sent a cease-and-desist letter to Novig dated September 17, 2026. It gave the company two options: stop offering sports wagering to people in Missouri, or obtain a licence from the Missouri Gaming Commission and pay the associated taxes and fees. The letter asked for confirmation within 30 days.
The attorney general's office announced the action on September 18, 2026, saying it had written to six companies: Polymarket, Kalshi, Crypto.com, Novig, Underdog and Robinhood. In its announcement, the office said Missouri law treats sports event contracts as unlicensed sports wagering.
Missouri voters approved sports betting in 2024 and the market launched on December 1, 2025. The state taxes sports betting at 10% of adjusted gross revenue, and an online licence and its five-year renewal can each cost as much as $500,000, according to the letter. Operators must also stop anyone under 21 from betting.
Why Novig Says Federal Law Applies
Novig argues its contracts are swaps under the Commodity Exchange Act, which would put them under the exclusive jurisdiction of the Commodity Futures Trading Commission. The complaint says the CFTC designated Ludlow Exchange as a contract market on June 16, 2026, after an application filed on December 16, 2025.
The company asks the court for a declaration that Missouri's gambling laws are pre-empted as applied to its contracts, plus preliminary and permanent injunctions. It says carrying on in Missouri could expose it to criminal liability under Chapter 572 of the state's statutes, civil penalties under the Merchandising Practices Act and abatement remedies.
The filing also points to the company's rules. Novig amended its rulebook on August 12, 2026 to add responsible trading standards, and the complaint says only participants aged 21 or over may trade. It adds that Novig was licensed as a sports betting operator in Colorado in 2023 before it moved to the federal route.
Missouri's Position And The Wider Fight
Missouri does not accept the swaps argument. Its letter to Novig says the state shares the view of the majority of federal courts that platforms like Novig's are subject to state gambling law, and cites rulings including the Sixth Circuit's decision in KalshiEx v. Schuler from April 24, 2026 and the Ninth Circuit's ruling in KalshiEx v. Assad from August 28, 2026.
A second challenge landed the same day. Crypto.news reported that North American Derivatives Exchange, the exchange behind Crypto.com's prediction market, filed its own suit in the Western District of Missouri, citing court records. The report said Kalshi, Polymarket, Robinhood and Underdog had not sued in Missouri's federal courts as of Sunday, October 18.
No ruling on Novig's injunction request had been reported at the time of writing. For Missouri bettors, the state says wagering stays available through operators licensed by the Gaming Commission.
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