Michigan Court Grants Preliminary Injunction to Block Sports Event Contracts

• Michigan Circuit Court for the 30th Judicial Circuit of Ingham Country has granted the state a preliminary injunction against Kalshi
• The order requires prediction market operators to utilize a third-party geolocation service to block sports event contracts in Michigan
• The preliminary injunction will remain in place for the remainder of the lawsuit proceedings

The Michigan Circuit Court for the 30th Judicial Circuit of Ingham County has granted the state a preliminary injunction against Kalshi, requiring the prediction market operator to block sports event contracts from the Great Lakes State.

The preliminary injunction will require Kalshi to utilize a third-party geolocation service to block sports event contracts in the state until the court grants the final order on the case. Any failure to do so will result in a fine of $500,000 per day.

“Kalshi long attempted to pass itself off as a legitimate gaming operation in our state, and I am relieved that this order further protects Michigan residents from its predatory, unlicensed practices,” Attorney General Dana Nessel said in a press release. “My office will continue to defend Michiganders and enforce our gaming laws, which ensure gambling revenue is regulated and distributed back into our communities.”

Second Order Halting Michigan Sports Event Contracts

Nessel levied a lawsuit against Kalshi in the 30th Judicial Circuit Court in Ingham County this past March, seeking a permanent injunction to stop the company from offering sports event contracts in the Great Lakes State.

Nessel and the Michigan Gaming Control Board claim Kalshi runs afoul of Michigan’s sports betting laws and sports event contracts are tantamount to unlicensed gambling.

Judge Rosemarie E. Aquilina granted Nessel and the state a temporary restraining order against the company in June, which temporarily halted the advertisement and offering of sports event contracts in Michigan.

Judge Aquilina granted the state its preliminary injunction request this week as well.

“Michigan and its most vulnerable citizens are suffering and will continue to suffer immediate and irreparable harm absent relief from being exploited by Kalshi’s sports betting operation masquerading as an investment opportunity. First, Michigan’s legalized gaming industry requires those who wish to place wagers to be 21 years of age or older. Kalshi, however, allows people to place wagers beginning at age 18. If Kalshi is allowed to continue to offer sports wagers, the potential irreparable harm on Michigan’s youth would be profound,” she wrote in her order.

She continued, noting that Kalshi does not provide necessary customer protections required by Michigan’s regulatory structure and fails to comply with Michigan gaming law, which gives it a “massive and unfair advantage over the entities that comply with Michigan’s regulatory structure.”

“Fifth, Kalshi is undercutting Michigan’s funding for schools, compulsive gambling prevention, economic development, and first responders. Sixth, the City of Detroit uses its gaming taxes to fund public needs, including law enforcement, public safety, economic development, youth programs, and infrastructure,” she wrote.

Prohibition on Advertising, Marketing, Soliciting

The preliminary injunction order prohibits Kalshi from engaging in any activity in connection with sports event contracts in Michigan, including offering, listing, matching, or facility any contract that constitutes online sports betting as defined by Michigan law.

Kalshi may also not market, advertise, promote, or solicit its sports event contracts in the state until the final order.