Summary
- The Ingham County Circuit Court issued a preliminary injunction against Kalshi, as signed by Judge Rosemarie Aquilina on Tuesday.
- Kalshi is required to implement geolocation services via a provider approved by the Michigan Gaming Control Board or face a penalty of $500,000 for each day of non-compliance.
- This order restricts all advertising, account funding, and any services resembling sports betting until a final ruling is made.
A judge in Michigan has ruled that Kalshi must cease its sports betting offerings within the state, imposing a daily fine of $500,000 for failing to geofence Michigan residents, as per an injunction signed on Tuesday.
Judge Aquilina expressed that the state's most vulnerable citizens could suffer immediate and irreparable damage from Kalshi's activities, which she described as a "sports betting operation masquerading as an investment opportunity."
@miattygen Dana Nessel announced a preliminary injunction against KalshiEx, LLC, preventing the prediction market platform from unlawfully offering sports betting in Michigan. More details can be found at https://t.co/viLe1gLqxh pic.twitter.com/oBd3vOUFXN
— Michigan Attorney General Dana Nessel (@MIAttyGen) September 2, 2026
The injunction notes that Michigan law mandates bettors to be at least 21 years old, while Kalshi allows participation from individuals as young as 18. The judge found that Kalshi's operations circumvent essential patron protections established by Michigan's regulations, detract from funding for educational institutions and compulsive gambling prevention programs, and undermine the revenue of Tribes while disregarding their sovereignty.
This legal order prohibits Kalshi from accepting deposits from Michigan residents, engaging in advertising through various channels, and allowing account setups or funding by state citizens. Products that are "functionally similar" to sports betting, including various types of bets, are also included in this restriction.
Requirements for Kalshi
To comply, Kalshi must utilize a licensed third-party geolocation provider that meets the Michigan Gaming Control Board's geofencing requirements. Within three business days, the company is obligated to inform all futures commission merchants offering its sports contracts about the injunction and provide the contact information for Michigan's legal representatives. Kalshi will not be held responsible for the actions of those firms afterward.
Attorney General Nessel filed a lawsuit in March under Michigan's Lawful Sports Betting Act, claiming that Kalshi allows residents to place bets on sports disguised as trading event contracts. After Kalshi attempted to transfer the case to federal court and lost, it returned to Ingham County. A temporary restraining order was issued in June, and both parties sought a ruling during an August 17 hearing. Kalshi's legal team includes Neal Katyal, a former acting U.S. solicitor general.
Nessel emphasized that the injunction serves to protect residents from what she termed Kalshi's "predatory, unlicensed practices." Kalshi has encountered challenges in state courts, notably being ordered by a judge in Washington to cease most of its markets shortly after the Commodity Futures Trading Commission (CFTC) intervened to keep it operational.
The CFTC has pursued legal action against nine states regarding similar matters, starting with Illinois, Arizona, and Connecticut, followed by Wisconsin and Minnesota shortly after its ban took effect. Former President Donald Trump has referred to officials opposing prediction markets as "SCUM."
The Michigan injunction will remain in effect until a final decision is reached in the case.