Washington State Gambling Commission and Louisiana Gaming Control Board have warned licensed operators that offering sports event contracts constitutes illegal gambling in their states. The notice concerns prediction markets.
Operators offering event contracts in either state face a warning that regulators consider the activity illegal gambling.
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Robinhood and Polymarket filed separate federal lawsuits seeking to stop Missouri officials from enforcing gambling laws against their sports event contracts. Both argue that federal commodities law gives the Commodity Futures Trading Commission exclusive jurisdiction; Missouri Attorney General Catherine Hanaway has separately filed counterclaims alleging Novig violated federal and state laws.
Robinhood and Polymarket filed separate federal lawsuits seeking to stop Missouri officials from applying gambling laws to their sports event contracts. Both companies argue that the Commodity Futures Trading Commission (CFTC) has exclusive jurisdiction over the products, rather than state gambling regulators.
Kalshi sued Louisiana officials in federal court on 23 October, seeking to block enforcement against its sports event contracts. The company argued that the state’s new law criminalising unauthorised computer gambling and officials’ actions threaten its federally regulated products; the Louisiana Gaming Control Board said it does not comment on pending cases.
The CFTC proposed rule changes on 9 October to classify sports, political, cultural and weather event contracts as swaps under US federal law. The proposal would explicitly include these contracts in the agency’s rules.
The Commodity Futures Trading Commission (CFTC) has proposed amending its rules so that event contracts based on sports, politics, culture and weather are explicitly included in the definition of a swap under federal law. The proposal was announced on 9 October, according to the regulator, and a public consultation has been opened before the agency decides whether to adopt the change.
The US Supreme Court has yet to decide whether to review prediction market litigation involving Kalshi. Legal observers warned that declining review could leave conflicting appeals court decisions unresolved and operators facing separate state disputes over the regulatory status of sports event contracts.
A report dated 12 October 2026 notes that the justices have so far given no indication of whether they will take up the Kalshi prediction market disputes. In the view of legal observers quoted in that report, refusing the petitions would probably push operators into a state-by-state contest over sports event contracts that varies from jurisdiction to jurisdiction.
The National Council of Legislators from Gaming States has filed an amicus brief urging the US Supreme Court to consider the dispute over sports event contracts, reportedly backing New Jersey Attorney General Jennifer Davenport’s petition. The lawmakers argue that states should retain authority over gaming-related products and warn that a ruling for Kalshi could prompt casinos and pari-mutuel businesses to restructure.