Michigan Attorney General Dana Nessel has won a preliminary injunction against prediction market platform Kalshi, preventing the company from offering sports-related event contracts to users in the state. The order requires Kalshi to keep Michigan residents and anyone physically located in Michigan from accessing the disputed markets while the broader lawsuit continues.
Ingham County Circuit Court Judge Rosemarie E. Aquilina signed the order on Sept. 1. It extends restrictions first imposed through a temporary restraining order in June and will remain in effect until the court issues a final ruling in the case.
It's the second major blow the prediction market platform has taken this week. The Ninth Circuit Court of Appeals ruled that Kalshi can't block Nevada gaming regulators from treating its sports event contracts as potentially unlicensed sports betting.
The Nevada decision is especially important because it conflicts with an April ruling from the Third U.S. Circuit Court of Appeals involving Kalshi and New Jersey.
What the Michigan Kalshi Injunction Requires
The injunction targets Kalshi products that Michigan considers internet sports betting. That includes contracts resembling moneyline bets, parlays, over-under wagers, proposition bets, pools, and in-game betting.
Kalshi must use a third-party geolocation provider licensed by the Michigan Gaming Control Board to prevent people inside Michigan from reaching its sports event contracts. The company also cannot offer, list, match, execute, settle, or otherwise facilitate covered sports contracts for users located in the state.
The order also limits Kalshi’s business activity in Michigan. It bars the company from accepting deposits connected to these products, allowing account creation or funding for sports contracts, and promoting the contracts to Michigan residents through advertising, social media, affiliates, push notifications, or similar channels.
If Kalshi fails to meet the geolocation requirements, the court can impose a fine of $500,000 for each day of noncompliance.
Why Michigan Is Challenging Kalshi
Nessel’s office argues that Kalshi is operating an unlicensed internet sports betting business under Michigan law. State officials say sports event contracts function like traditional sports wagers and must therefore follow the same state licensing, age-verification, responsible-gambling, and consumer-protection rules.
Michigan’s regulated sportsbooks must operate under oversight from the Michigan Gaming Control Board. The state has also argued that licensed gambling operators contribute tax revenue and follow rules intended to protect customers, including restrictions meant to limit underage gambling and address problem gambling.
The court’s decision signals that Michigan sees the distinction between a “prediction market” and a sportsbook as less important than how the product works for consumers. If a contract allows someone to take a financial position on the outcome of a sporting event, state regulators argue it should be treated as sports betting.
Kalshi’s Legal Defense and the CFTC Question
Kalshi disputes Michigan’s authority over its platform. The company has argued that it operates as a federally regulated exchange and that the Commodity Futures Trading Commission, rather than state gaming regulators, has primary oversight of its event-contract markets.
That argument sits at the center of a growing national fight between state gambling regulators and prediction-market operators. Michigan’s preliminary injunction does not decide the final legal question, but it gives the state immediate enforcement power while the case moves forward.
