Utah attorney general sues Kalshi, names Susquehanna firms and seeks up to $61 million
Utah Attorney General Derek Brown sued Kalshi on Tuesday, seeking to block the prediction market from operating in the state and recover up to $61.2 million in alleged gambling profits and fees. The suit alleges a 'brazen pattern' of violating Utah's gambling ban, likening the CFTC-regulated exchange to a 'back-alley gambling den' and naming Susquehanna firms. The action follows an August federal court ruling that rejected Kalshi's preemption defense, clearing the path for state enforcement. Utah claims residents lost $5.5 million on the platform.
Kalshi's federal shield is now pierced in a third enforcement front, and Utah's demand for tens of millions in profit recovery raises the financial stakes beyond prior suits. The Susquehanna naming turns market-making relationships into litigation targets, threatening the liquidity backbone that lets event contracts trade at tight spreads.
Other state attorneys general are watching: the Ohio and Tennessee template is now copied in Utah, and each victory makes the next filing cheaper to draft. Kalshi must now fund parallel defenses across multiple circuits while the CFTC's swap rulemaking remains in review. The first platform to lose on damages rather than just injunctive relief faces a compliance price that reshapes capital allocation across the sector.
Becomes the third state enforcement action against Kalshi after Ohio and Tennessee, as the NFL-backed state-gambling framing spreads from the Sixth Circuit rules to Utah and Missouri.