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Baltimore sues Kalshi and Polymarket over sports event contract offerings

Legal Writer

Publish Date: Aug 17, 2026

Fact checked by: Matt Moreno

Key Points

Baltimore City Council’s complaints accuse Kalshi and Polymarket of violating city’s consumer protection ordinance
Allegations are tied to exchanges’ sport event contracts offerings
Maryland state government has also disputed the legality of sports event contract trading

The Baltimore City Council and Baltimore Mayor Brandon M. Scott have gone to court to try to stop Kalshi and Polymarket offering sports event contracts to people in the city. The lawsuit alleges that the two prediction market exchanges have deceived Baltimore residents by offering unlicensed sports wagering in violation of Maryland law and city ordinances.

If successful, this litigation could compound the difficulties that prediction market exchanges are already facing in Maryland. The Maryland Lottery and Gaming Control Commission is also trying to curtail Kalshi’s and Polymarket’s contract offerings across the Old Line State.

Baltimore announces lawsuits against Kalshi, Polymarket

A press release from Johnson’s office lays out the case against Kalshi and Polymarket.

“The lawsuits allege that Kalshi and Polymarket offer sports wagering in Baltimore without the licenses required under Maryland law, allowing them to compete with regulated sportsbooks while avoiding the oversight, taxation, responsible-gambling requirements, and consumer protections imposed on licensed operators. ... The lawsuits further allege that Kalshi and Polymarket market their platforms in ways that create a false or misleading impression that their offerings are lawful and appropriately regulated, while making gambling readily accessible to consumers.”

In the complaints, the city seeks damages for Baltimore residents who have used the exchanges and a declaration that Kalshi’s/Polymarket’s sports event contracts violate the city’s consumer protection ordinance. The lawsuits also ask the court to enjoin Kalshi and Polymarket from continuing to offer sports event contracts in the city.

This action begins as Maryland authorities’ litigation against Kalshi and other prediction market exchange operators is ongoing.

Maryland gaming regulators also have sports event contracts in their sights

Currently, a request for a preliminary injunction that would prevent state officials from enforcing Maryland gambling laws against Kalshi is on appeal to the United States Fourth Circuit Court of Appeals. The U.S. District Court for the District of Maryland denied that request from Kalshi in April 2025.

Kalshi sued officials with the Maryland Lottery and Gaming Control Commission (MLGCC) that month after they sent cease-and-desist letters to multiple prediction market exchanges. Each of the demands stated that sports event contracts violated Maryland gambling laws.

MLGCC staff have not moved to enforce those letters as the litigation has been ongoing. A decision from the Fourth Circuit could come at any time, and if it is a favorable ruling for the state, they could take further action at that point.

That could address the injunction that Baltimore is seeking, but may not do so to the satisfaction of the city council or Johnson. Either way, there would still be the consumer protection violations to address, so the city is unlikely to drop this lawsuit anytime soon.

Cities become latest governmental bodies challenging prediction market trading

Baltimore is the second major U.S. city to take action against prediction market exchange operators. New York City opened an investigation into the marketing practices of multiple operators including Kalshi and Polymarket earlier in August 2026.

At this time, that inquiry has not produced any formal allegations against any of the operators. Civil and criminal enforcement could be the result of the investigation, though.

The inquiry points to reports that Polymarket used deceptive advertising techniques. That included paying people with high numbers of social media followers to post about earnings on the platform that they had secured using funds provided by Polymarket.

If state governments are ultimately unsuccessful in reigning in sports event contract trading using their gambling laws, city ordinances concerning marketing practices could still prove effective. At this time, Kalshi and Polymarket are fending off both types of allegations.

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