Baltimore Sues Both Kalshi, Polymarket For Alleged Illegal Sports Betting

• Baltimore today filed lawsuits against both Kalshi and Polymarket for operating an alleged illegal, unlicensed sports betting platform
• City alleges the companies violated Baltimore’s Consumer Protection Ordinance
• Lawsuits also allege the companies market their platforms in false or misleading impressions

The City of Baltimore today filed lawsuits against Kalshi and Polymarket, alleging the prediction market companies offer illegal and unlicensed sports betting in the city.

The filed lawsuits allege both Kalshi and Polymarket allow Baltimore residents to bet on similar markets similar to the state’s licensed online sports betting platforms. Despite the companies describing these markets as “event contracts,” the lawsuits contend they function as nothing more than sports bets and constitute unlawful gambling under Maryland law.

“These companies are running sportsbooks without licenses and betting that a new label will put them above the law,” Baltimore Mayor Brandon M. Scott said in a press release. “It won’t. Baltimore will not let multibillion-dollar companies put profits over people and harm our communities through illegal gambling.”

Potentially Violating Baltimore Law

According to the lawsuits, both Kalshi and Polymarket are in violation of Baltimore’s Consumer Protection Ordinance by operating the alleged illegal, unlicensed sports-betting platforms and by misleading consumers about the legality and regulatory status of their products.

“Defendants Kalshi Inc. and KalshiEX LLC (the “Defendants” for the purposes of this Count) have violated the CPO by engaging in deceptive acts and practices in Baltimore City. Through the promotion of sports wagering on their websites and mobile apps, Defendants have repeatedly conveyed the false, deceptive, and misleading impression that the sports wagers they offer through their prediction market are lawful in Maryland. Through statements on the Kalshi website, Defendants have also misrepresented that Kalshi’s markets are trustworthy, transparent, safe, and protected against insider trading and market manipulation,” City of Baltimore counsel wrote in its lawsuit against Kalshi.

The city alleges Kalshi and Polymarket both market their their platforms in way that create a “false or misleading impression” that their services are lawful and appropriately regulated.

A Kalshi spokesperson told Sports Betting Dime people use regulated prediction markets because “they’re neutral, fair and transparent marketplaces.”

“Kalshi spent years getting regulated by the federal government and abide by all applicable regulations, including consumer protection laws. If the mayor has genuine concerns about guardrails, we’re always happy to chat. In the meantime, we will defend these claims in court,” the spokesperson said.

Just Repackaged Gambling

City Solicitor Ebony M. Thompson noted the companies cannot circumvent the city’s consumer protections by repackaging gambling as another type of market or claiming federal regulations put them outside of state and city laws.

“The City will continue to use its consumer protection authority to stop deceptive and unlawful conduct and hold companies accountable when they put our residents at risk,” Thompson said.

Baltimore asserts claims for unfair, abusive, and deceptive trade practices under Baltimore’s Consumer Protection Ordinance and seeks civil penalties, injunctive relief, restitution for affected consumers, disgorgement of ill-gotten profits, and other relief authorized by law.