Washington Attorney General Files Civil Lawsuit Against Kalshi Accusing it of Illegal Gambling Operation - Tekedia

Washington Attorney General Nick Brown filed a civil lawsuit against Kalshi in King County Superior Court.

The suit accuses Kalshi of running an illegal online gambling operation disguised as a prediction market and cites violations of Washington's Gambling Act and Consumer Protection Act.

The state seeks a permanent injunction to bar Kalshi from operating in or targeting Washington, restitution for users' losses, and civil penalties for each alleged violation.

Kalshi removed the case to the U.S. District Court for the Western District of Washington, arguing the dispute raises federal questions under the Commodity Exchange Act and defending the platform as a legitimate prediction market.

Washington frames the action as a consumer protection effort rather than criminal prosecution; the complaint cites Kalshi’s marketing as evidence of knowingly circumventing state restrictions, and the case is part of broader state-level scrutiny.