Kalshi files lawsuit against Ohio regulator following $5m civil penalty request

Kalshi has filed a lawsuit in state court against the Ohio Casino Control Commission, following the regulator’s proposal for a $5m fine to be issued against the operator for conducting business without an approved license since January 2025. 

Within the lawsuit, Kalshi is seeking permanent injunctive relief which forbids the regulator from continuing with its administrative proceedings, as well as two separate declaratory judgements. 

"The Commission’s administrative proceeding affords no right to a civil jury. This violates Kalshi’s right to trial by jury under Article I, Section 5 of the Ohio Constitution and transgresses the separation of powers embedded in Article II, Section 1 of the Ohio Constitution,” the lawsuit states. 

On April 14, the Ohio Casino Control Commission issued a letter of intent and proposed a $5m fine against Kalshi, believing the operator has been conducting business in the state without a license since January 2025.

"By continuing to operate without seeking licensure, Kalshi has effectively thwarted the Commission from investigating Kalshi's suitability," the notice said. 

"As a result, the Commission also lacks awareness of whether, or to what extent, Kalshi adheres to the various safeguards and guardrails that Ohio law requires."

During March 2026, a federal judge in Ohio had previously ruled in favor of state regulators when Kalshi filed a lawsuit against the Ohio Casino Control Commission for attempting to prohibit its operations. 

Kalshi argued its sports-event contracts should be treated as federally regulated swaps under the Commodity Exchange Act, a category typically associated with financial derivatives used in investment markets.

US District Judge Sarah Morrison rejected the argument, however, concluding that the contracts tied to sporting outcomes do not meet the legal definition of a financial swap.

It remains to be seen whether Kalshi’s most recent lawsuit is able to deter the Ohio Casino Control Commission from moving forward with its proposed fine, but the legal matter represents yet another prediction market battle across the US.