Key Points:

• The attorneys general said the outcome of the Mass. case affects their citizens

• Mass. in September became the first state to sue a prediction market

• Kalshi says it should be regulated by the CFTC, not state gaming regulators

Thirty-eight state attorneys general filed an amicus brief in support of Massachusetts’s lawsuit against the prediction market platform Kalshi, as the company and others continue the legal fight over whether state gaming regulators or the Commodity Futures Trading Commission should oversee the industry.

The attorneys general, referred to as “the amici States” in the brief, write that they have “traditionally regulated gambling, including sports betting,” and “are interested in this case because Kalshi’s aggressive theory of preemption threatens the States’ longstanding ability to protect their citizens in this area.”

The brief was penned by Nevada Attorney General Aaron Ford and Ohio Attorney General Dave Yost. Signing onto the brief were the attorneys general of Alabama, Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Hawaii, Idaho, Illinois, Iowa, Kansas, Louisiana, Maine, Maryland, Michigan, Minnesota, Mississippi, Nebraska, New Jersey, New Mexico, New York, North Carolina, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Utah, Vermont, Virginia, Wisconsin and the District of Columbia.

The brief outlines that Kalshi continues to operate in states even where sports betting is illegal. The U.S. Supreme Court lifted a ban on sports gambling in most states in 2018. It remains outlawed in 19 states, including in Washington, California and Texas.

“The increased legalization of gambling has not left gambling unregulated,” the brief reads, noting the number of state gambling laws and adding that “state gambling regulation has long co-existed with federal regulation of derivatives markets.”

Massachusetts Attorney General Andrea Campbell in September 2025 made the Bay State the first in the country to sue a prediction market when she initiated the lawsuit against Kalshi filed in Suffolk County Superior Court. Judge Christopher Barry-Smith in January granted a preliminary injunction in favor of the attorney general, banning Kalshi from offering sports contracts in the state. A month later an appeals court granted Kalshi an emergency stay, putting the ban on hold while the case plays out.

Kalshi, which is based in New York, says it is not gambling or sports betting. The company, which is registered with the CFTC, says it operates more like derivatives markets, which are overseen by the CFTC.

State regulators disagree. For the past year, the prediction market operator has sparred with state regulators across the country over whether it should be beholden to state gaming laws or answer to federal officials. Kalshi alone is involved in more than 30 cases.

The brief, released Friday, came on the same day that the CFTC filed a lawsuit in the U.S. District Court for the Southern District of New York seeking to prevent the state from enforcing its gambling laws against prediction market operators.

New York Attorney General Letitia James earlier that week sued Coinbase and Gemini for allegedly running illegal gaming enterprises. The case marked the fourth time the CFTC filed a suit against a state seeking to enforce its gambling laws against prediction market companies: The Trump administration earlier this month sued Arizona, Connecticut and Illinois.

Emma Kinery is a State Affairs national reporter covering state politics and policy out of our Washington, D.C. office. Contact Emma Kinery at ekinery@stateaffairs.com or on X @EmmaKinery.

RELATED

High court sets timeline in Kalshi sports ‘contract’ case

CFTC sues New York to prevent prediction market enforcement

New York AG sues Coinbase, Gemini for prediction market offerings

Federal appeals court sides with Kalshi, allows sports contracts in N.J.

Robinhood sues Washington state following AG’s Kalshi suit

Washington joins states suing Kalshi over gambling claims

Trump admin. sues Ariz., Conn., Ill. over prediction markets

Court grants Nevada two-week restraining order against Kalshi

Kalshi vs. state regulators: State of play

Prediction markets face legal challenges as Super Bowl bets surge

Prediction markets form coalition amid scrutiny from state regulators

State AGs call on DOJ to crack down on illegal gambling websites