California Joins Multistate Legal Battle Against Prediction Markets

California Attorney General Rob Bonta joined two bipartisan coalitions of attorneys general in filing two amicus briefs supporting New York and Wisconsin. The filings support the right of states to enforce local sports gaming and gambling laws against prediction market operator Kalshi. These legal filings mark the tenth and eleventh time California has joined multistate amicus efforts targeting Kalshi and similar prediction market companies.

The attorneys general argue primarily that federal preemption of state gambling laws as applied to prediction market providers is improper. They maintain that such preemption harms the traditional role of states in regulating gambling and protecting vulnerable citizens. State officials contend that prediction market companies cannot use federal loopholes to bypass consumer protection, sports gaming, and gambling laws.

Details of the Legal Battles in New York and Wisconsin

The New York dispute stems from a case titled KalshiEX, LLC v. Williams, et al. After the New York State Gaming Commission sent a cease-and-desist order to Kalshi, the company sued the commission. A district court denied Kalshi’s preliminary injunction motion, ruling that New York gambling laws applied to Kalshi’s sports-event contracts are not preempted. Kalshi has since appealed this decision to the U.S. Court of Appeals for the Second Circuit.

The Wisconsin case, Commodities Futures Trading Commission v. State of Wisconsin, began when Wisconsin filed a state court action against several prediction market providers and crypto platforms, including Coinbase, Kalshi, Robinhood, Polymarket, and Crypto.com. After those companies moved the cases to federal court, the Commodities Futures Trading Commission (CFTC) filed its own federal lawsuit against Wisconsin and moved for a preliminary injunction to block the state from enforcing its gambling laws. The district court denied the CFTC’s preliminary injunction motion, and the agency appealed that decision to the U.S. Court of Appeals for the Seventh Circuit.

What This Means for State Regulation and Consumers

State officials argue that unregulated gaming platforms and prediction markets pose risks, particularly to young people who may be vulnerable to addictive gaming operations. The multistate briefs support state authority to regulate legal gaming and prevent federal commodities laws from being used to evade local rules. For ordinary people, these legal battles center on whether state consumer protection laws can reach modern online prediction platforms that offer sports-related contracts.

The source materials do not outline specific steps, deadlines, or claims procedures for individual consumers regarding these appellate cases. The litigation involves state regulatory agencies, federal regulators, and private platform operators rather than direct consumer lawsuits.

When state regulatory enforcement, platform restrictions, or online gaming disputes impact your financial interests or consumer rights, talking to a lawyer may help clarify your legal position.

This article is general information based on California Attorney General and court or agency records available at publication time. It is not legal advice; laws and deadlines differ by state and by case. Published November 6, 2026.