U.S. DOJ and CFTC Sue Arkansas to Block Enforcement Against Kalshi

On November 13, The Block reported that the U.S. Department of Justice and the Commodity Futures Trading Commission (CFTC) filed a lawsuit on Thursday against Arkansas Attorney General Tim Griffin, seeking to block the state’s enforcement action against prediction market platform Kalshi and requesting the court to enjoin future similar state-level measures against CFTC-regulated prediction markets.

This lawsuit pushes a specific case to the boundary of federal and state regulatory jurisdiction: Arkansas previously took action against Kalshi under state law, while the DOJ and CFTC argue that CFTC-regulated prediction markets should be uniformly governed by federal rules, warning that separate state enforcement would cause regulatory fragmentation. Since the requested relief covers future state-level actions, the impact extends beyond this single case involving Arkansas and Kalshi.

Similar conflicts are emerging across multiple jurisdictions. In late October, Utah filed criminal charges against Kalshi and two of its co-founders for alleged illegal gambling. Earlier this month, Polymarket and OG.com also filed lawsuits in federal court challenging Arkansas’ enforcement, asserting federal preemption. Meanwhile, Kalshi continues to petition the CFTC for additional futures products, including crude oil and equity indices.