Kalshi, the CFTC-registered prediction market platform, just lost a critical legal skirmish in Michigan. A federal judge has sent a lawsuit filed by Michigan Attorney General Dana Nessel back to state court, effectively blocking Kalshi from allowing Michigan residents to place sports bets while the legal fight plays out.
What the judge actually decided
Michigan AG Dana Nessel filed suit against KalshiEx LLC on March 3, 2026, in state court, alleging that Kalshi’s sports event contracts violate Michigan’s Lawful Sports Betting Act.
Kalshi attempted to move the case to federal court. The argument was straightforward: Kalshi operates as a Designated Contract Market registered with the Commodity Futures Trading Commission, so federal law should govern the dispute.
Judge Paul L. Maloney disagreed. On June 26, 2026, he ruled that Kalshi failed to establish federal jurisdiction and remanded the case back to state court.
