New Mexico AG Torrez sues Kalshi over alleged illegal sports betting
New Mexico Attorney General Raúl Torrez filed a civil enforcement action against prediction market platform Kalshi on Thursday, June 4, 2026, in Santa Fe County District Court, alleging the company's sports event contracts constitute illegal online sports betting under state gaming laws. Torrez claims Kalshi 'plays the same role as a traditional' sportsbook and is circumventing state gambling regulations through the event-contract label. The suit follows a separate federal lawsuit filed weeks earlier by a group of New Mexico pueblos also targeting Kalshi's sports betting operations. The state seeks an injunction to block trading of sports-linked event contracts and a court declaration that such trades constitute sports wagering. New Mexico joins a growing list of states taking legal action against the CFTC-regulated exchange as it expands into sports event contracts.
Torrez's suit creates a parallel state-court front against Kalshi's sports contracts beyond the federal tribal case, forcing the platform to defend its product architecture in two jurisdictions simultaneously. Any state-level injunction would directly block New Mexico residents from trading even if Kalshi prevails in federal court.