Kalshi Joins Other Prediction Market Operators Moving Against Missouri Attorney General

Missouri Attorney General Catherine Hanaway's cease-and-desist demands of six designated contract market operators have now resulted in lawsuits naming her as a defendant from half of those recipients. Kalshi filled out that number on Wednesday with its complaint in the United States District Court for the Eastern District of Missouri.

As in essentially all of its other lawsuits against state officials across the US, Kalshi is arguing that Hanaway's demand represents a premise that it can't comply with while also remaining compliant with federal law. Hanaway's deadline for compliance has already passed, raising questions about which actions she will take to reinforce the demands, if any.

Kalshi joins Crypto.com, Novig in taking Hanaway to court

Kalshi's Tuesday complaint names Hanaway as the lead defendant, but also includes the Missouri Gaming Commission (MGC) along with MGC officers. The brief requests that the court declare that Kalshi's designated contract market (DCM) is protected by federal securities statutes and that the US Commodity Futures Trading Commission has exclusive oversight of its DCM.

The complaint also asks the court to enjoin Hanaway and the MGC from enforcing Missouri's gambling laws against Kalshi's sports event contracts. Crypto and Novig have requested similar protection from federal courts in Missouri, as they received the same cease-and-desist (C&Ds) demands from Hanaway that Kalshi did.

Crypto and Novig were more expedient in their filings than Kalshi. The other recipients; Polymarket, Robinhood, and Underdog, have yet to take public action in response.

Their replies may depend on what Hanaway does next. All six recipients have let a deadline that she imposed pass without significant measures to comply with the order.

Hanaway's options hinge upon legal tactics and resource allocation

Hanaway's original C&Ds set a deadline of Oct. 18, 2026 for the recipients to share plans to comply with her demands. The letters gave Kalshi and others the choice of obtaining sports wagering licenses from the MGC or blocking access to sports event contracts for people in the state.

To date, none of the six DCMs have done either. Whether they do so may depend on how Hanaway proceeds and how the courts rule on the various requests for injunctive relief.

Other state attorneys general across the US have filed lawsuits of their own in state courts. Two have gone as far as to bring criminal charges against Kalshi and its executives as well.

Hanaway has not commented on whether she will take any of those actions to enforce her C&Ds. She may similarly be content to await the district courts' rulings.

The three cases will mostly litigate the same issues that Hanaway would pose to a state court. It's also likely that if she sued any of the DCM operators in state court, the defendant(s) would try to have the case removed to federal court anyway.

If the district courts deny the injunction requests, Hanaway can move forward with civil or criminal proceedings in state court with greater confidence. Should one of the courts enjoins her enforcement, such a ruling would block her moving forward with the C&Ds.

For the time being, it looks like Missourians' access to sports event contract trading will be litigated in the two federal district courts for the state. Hanaway seems content to focus her resources there until the courts rule.