Three class action cases against Kalshi have become one, with the similar arguments contained within each now consolidated under one new case filing, known as 'In re Kalshi Sports Prediction Market Litigation.'
San Francisco resident Daniel Yee made the initial complaint back on October 16, 2025, seeking to recover “hundreds of millions of dollars” for Kalshi users – this is money that the plaintiff alleges was illegally taken by Kalshi off the back of misleading marketing campaigns.
Before this case reached any conclusion, two more claims joined it in the district courts of New York.
Pelayo et al v Kalshi et al is an attempt by seven Kalshi users to prove that the operator is running an illegal sports gambling platform and not a ‘prediction market’ as it purports.
And latterly, in January, Hallman, Kravetz, Greenberg, Bee and Gutta added to Kalshi’s list of going legal concerns by filing another federal lawsuit, which added an additional argument into the mix.
The plaintiffs contested that Kalshi’s model is not peer-to-peer as it claims, but tantamount to a more traditional ‘against the house’ system due to its use of affiliated ‘market makers,’ which provide liquidity for equity.
Kalshi does not dispute its use of market makers, indeed Jump Trading recently acquired stakes in both Kalshi and Polymarket to act in that capacity.
According to Hallman et al, this fact alone undermines the arguments that Kalshi has been making to various state gambling regulators in an attempt to differentiate itself from sportsbooks.
All of these arguments will now be considered as part of the consolidated case to avoid the unnecessary duplication of discovery phases.
The newly consolidated lawsuit will see the individual Hallman et al and Pelayo et al cases officially closed – this new scope of litigation has been agreed upon by the presiding Judge Jennifer L Rochon, the attorneys for all plaintiffs and Matthew J Laroche, Kalshi’s own attorney for defence.
In New York, Kalshi recently paid for a three-hour event where members of the public could claim $50 of free groceries each
