Troutman Pepper Locke’s State Attorneys General Practice Group, was mentioned in the November 4, 2025 Law.com article, “Robinhood Shareholders Gleeful Over Firm’s ‘Prediction Market’ Push, But State AGs Say It’s Illegal Gambling.”
The outcome of the Massachusetts litigation and litigation in other states “will set important precedent for how prediction markets are treated
On October 7, 2025, Kalshi, a platform specializing in prediction market trading, filed a lawsuit against the Ohio Casino Control Commission (OCCC) and Ohio attorney general (AG), alleging that their regulatory actions overstep state authority. The complaint seeks to block enforcement of a cease-and-desist order that was issued by the OCCC in the spring, which accused Kalshi of “operating online sports gaming” and warned Ohio licensees that partnering with Kalshi could jeopardize their licensing status and integrity.
Massachusetts Attorney General (AG) Andrea Joy Campbell recently filed a lawsuit in Suffolk Superior Court against KalshiEX LLC (Kalshi), an online prediction market platform, alleging that the platform runs an illegal sports wagering operation without an appropriate license in Massachusetts. The complaint asserts that Kalshi offers Massachusetts consumers the equivalent of sports betting under the guise of “event contracts,” letting users wager yes-or-no options on sporting outcomes just like traditional bets. In the AG’s view, these contracts closely resemble sports wagers offered by licensed sportsbooks, and Kalshi actively promoted its sports products via TV and social media in the Commonwealth while allowing trades through third-party apps like Robinhood. Because Kalshi asserts that its event contract business does not constitute gaming, Kalshi never obtained a license from the Massachusetts Gaming Commission to engage in gaming-related activities.
In addition to receiving cease-and-desist orders from several states (Arizona, Illinois, Montana, and Ohio), and ongoing litigation against New Jersey state gaming regulators in the U.S. Court of Appeals for the Third Circuit, KalshiEx LLC (Kalshi) is also now embroiled in litigation with regulators in Maryland and Nevada. Kalshi operates as a designated contract market, which allows adults in all 50 states to make financial trades on a broad range of topics — from sports to the weather.
The United States is navigating a new era of regulatory oversight and the balance of power between federal and state regulators following the 2024 election cycle. As federal agencies retreat from and/or realign their regulatory enforcement priorities, state attorneys general (AGs) are increasingly taking the lead in policing companies — especially those that are consumer-facing — bridging perceived gaps left by shifting federal priorities, and in some cases, emboldened to expand regulatory enforcement into relatively new arenas.
A lawsuit between KalshiEx LLC (Kalshi) and New Jersey state gaming regulators in the Third Circuit is testing the balance between federal commodities regulation and state authority regarding sports betting.
In a significant regulatory shift, the Texas Lottery Commission has enacted an immediate ban on lottery ticket courier services in the state, effective February 24. This decisive move marks a stark departure from the commission’s previous position that it lacked jurisdiction over these couriers. State officials in Texas backing the change assert that groups who buy mass quantities of lottery tickets using unregulated lottery couriers avoid safeguards in the regulatory system and undermine public trust in the lottery system.
Indiana Attorney General (AG) Todd Rokita recently partnered with the Indiana Gaming Commission to alert consumers about advertisements for illegal gambling.[1]
Stephen Piepgrass, co-leader of Troutman Pepper Locke’s Regulatory Investigations, Strategy + Enforcement (RISE) Practice Group, was interviewed in the February 17, 2025 CasinoReviews.net article, “Sweepstakes Casinos: Thriving in an Ever-Changing Industry – Interview with Attorney Stephen C. Piepgrass.”
In the article, Stephen provides valuable insights into the legal hurdles sweepstakes casinos are up
Among the several provisions on the ballot in the recent election, Missouri citizens voted for Amendment 2, which will legalize online and retails sports betting. The amendment won by a small margin of less than 7,500 votes.