Michigan Enters Prediction Market Fight
Michigan became the latest state to bring a case against prediction markets this week.
On Tuesday, Michigan Attorney General Dana Nessel sued Kalshi in state court over its sports contracts.
It’s the same tactics used by Massachusetts. Massachusetts regulators sued Kalshi first in state court. After the legal fights over which court would hear Kalshi’s case concluded, Massachusetts secured a victory in state court against the CFTC-regulated exchange.
Better to sue first in state court than get sued in federal court.
Easier to thwart a “complete preemption” argument on removal than general preemption when sued first in federal court.
A higher bar for Kalshi to clear.
The Massachusetts blueprint. https://t.co/jc93WqwBlR
— Daniel Wallach (@WALLACHLEGAL) March 3, 2026
Michigan seems to be hoping to replicate Massachusetts’ early success. Kalshi is appealing its loss in Massachusetts, though the exchange faces an uphill battle in state court.
A day later, Polymarket and Robinhood joined the fray in Michigan.
Polymarket and Robinhood sue Michigan
Polymarket and Robinhood both filed lawsuits against Michigan’s attorney general and the Michigan Gaming Control Board on Wednesday.
Both companies recognize threats to their own businesses in Michigan’s case against Kalshi. Robinhood offers Kalshi’s markets, and Polymarket is rolling out its CFTC-regulated app to American customers. Neither company wants to geofence state by state like licensed sportsbooks must.
The Michigan cases came shortly after Nevada received its own procedural victory in its state courts.
Nevada remands Kalshi and Polymarket case to state court
Kalshi and Polymarket learned they would fight their legal battles against Nevada gaming regulators in state court on Monday. Nevada District Judge Miranda Du ruled that the case’s issues had to do with state law violations, so the cases should be heard in state court.
On Wednesday, Nevada applied for a temporary restraining order against Kalshi. Kalshi filed its opposition brief and an emergency motion for a stay pending appeal.
The Third Circuit still has not released an opinion from its oral arguments between Kalshi and New Jersey in September. While states have become split on whether state gaming regulators can regulate sports contracts, appeals courts haven’t weighed in yet.
Split circuit courts make a Supreme Court hearing more likely, and the Third Circuit remains viewed as Kalshi’s most favorable.