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Arkansas sues Kalshi, alleging illegal gambling and deceptive trade practices

The state asks a court for restitution, penalties, taxes and an injunction. No court has ruled, and the filing does not by itself change what Kalshi offers in Arkansas.

November 4, 2026 · Effective · Verified 2026-11-05 via official announcement

Arkansas Attorney General Tim Griffin sued KalshiEX LLC and Kalshi Inc. on 4 November 2026, alleging that Kalshi runs an unlicensed gambling platform in the state and violates the Arkansas Deceptive Trade Practices Act. The civil suit, case no. 32CV-26-717, was filed in the Circuit Court of Independence County.

Griffin says Kalshi opened its platforms to Arkansas consumers as young as 18 and let them wager on sports and entertainment events without the licences, oversight, restrictions and taxes that apply to lawful gambling operators. He points to Kalshi's self-exclusion tools, deposit limits and problem-gambling resources as evidence that it knows the product works like gambling, and says it is aware of risks including excessive wagering, financial losses, depression and other mental health harms. These are the state's allegations; no court has found them proven. The complaint calls Kalshi a "pocket-sized bookie".

The complaint says those risks are greater for users under 21, citing restrictions it says Kalshi recently announced for users aged 18 to 20: enhanced monitoring, the ability to link accounts to a parent, and deposit limits.

The suit follows Griffin's October 2025 formal opinion that Kalshi-style sports contracts are unlicensed gambling under state law. Griffin also sued online gaming platform VGW the same day in a separate case. Kalshi told Ars Technica it follows federal rules and "will defend against Arkansas's baseless claims".

The 57-page complaint demands a jury trial and asserts only state-law claims, including deceptive trade practices and unjust enrichment. It asks the court to declare that Kalshi broke the deceptive trade practices law, bar the alleged practices, and order restitution, damages, maximum civil penalties, unpaid taxes, attorneys' fees and interest. The Defiant reports that the penalties run up to $10,000 per violation. The complaint also cites election and awards contracts, and says Arkansas limits gambling, including casino gaming and sports wagering, to people 21 and older.

Arkansas joins a growing list of states in court with Kalshi, including New York, Connecticut, Utah, Nevada, Massachusetts and Washington. Kalshi says its contracts fall under federal oversight by the CFTC. In the same week, federal appeals courts refused Kalshi relief in its Nevada, New York and Connecticut cases.

“The relief we are seeking includes restitution, penalties, taxes, and injunctive relief.”

— Arkansas Attorney General Tim Griffin

Who this affects

Kalshi users in Arkansas. No court order yet limits contracts there.

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