New Mexico Sues Kalshi, Seeks Injunction Over Sports Contracts

New Mexico’s Department of Justice filed a lawsuit against Kalshi, alleging the prediction market operator is unlawfully conducting sports betting in the state and asking a court to block its sports-related contracts. The state seeks injunctive relief to stop Kalshi from offering sports contracts to New Mexico residents.

The complaint alleges Kalshi functions as a sportsbook while operating without a license from the New Mexico Gaming Control Board and without following state gaming laws. “Despite looking like a sportsbook, acting like a sportsbook, and proverbially quacking like a sportsbook, neither Kalshi nor any of its subsidiaries have sought licensure,” the filing states.

State lawyers say the platform accepts wagers, facilitates transactions, determines outcomes and collects fees in ways comparable to licensed operators. The complaint cites Kalshi marketing that described the platform as “The First Nationwide Legal Sports Betting Platform” and promoted “Sports Betting Legal in All 50 States on Kalshi.” The filing adds Kalshi now offers products similar to moneyline, point spread, totals, proposition and parlay wagers.

The suit also raises an age issue, noting Kalshi allows users aged 18 to 20 to register while New Mexico law requires gamblers to be at least 21. State attorneys assert Kalshi bypassed the state licensing process that includes required responsible-gambling safeguards and consumer protections for licensed operators.

The complaint emphasizes New Mexico’s tribal-state gaming compacts. The filing follows a separate federal lawsuit filed last month by four tribes — the Mescalero Apache Tribe, Pueblo of Isleta, Pueblo of Pojoaque and Pueblo of Sandia — which allege Kalshi’s sports event contracts violate the Indian Gaming Regulatory Act, tribal-state compacts and tribal gaming ordinances when trades are placed while physically on tribal land.

Tribal groups in other states have filed similar suits. A federal judge in Wisconsin allowed the Ho-Chunk Nation’s IGRA claims to proceed earlier this year. In California, a federal judge dismissed a tribal challenge in November 2025, finding the Commodity Exchange Act preempted state and IGRA claims; that decision is now on appeal.

The complaint notes federal involvement in disputes over prediction markets. The Commodity Futures Trading Commission has sued Arizona, Connecticut, Illinois, Minnesota, New York and Wisconsin and has filed amicus briefs in cases in Massachusetts, Ohio and Nevada, arguing it has exclusive authority over designated contract markets under the Commodity Exchange Act.

New Mexico’s filing requests a court order preventing Kalshi from offering sports-related contracts to residents and says the company did not follow the state’s licensing process. The case joins other litigation over how prediction markets operate alongside state gaming rules and tribal gaming rights.