Just days after Washington sued the prediction market operator Kalshi in state court, Robinhood sued Washington in Federal court.
Key Takeaways
- Washington State Attorney General Nick Brown filed a lawsuit on Friday, suing prediction market operator Kalshi for illegal gambling.
- Kalshi partner Robinhood sued Washington State on Monday, seeking a permanent injunction.
- The Washington lawsuit activity mirrors that in Massachusetts.
In its recent lawsuit filed with the U.S. District Court for the Western District of Washington at Tacoma, the financial services company Robinhood claimed “there is a concrete and imminent threat that Washington will file an enforcement action against Robinhood as it did against Kalshi.”
Robinhood sues Washington State in response to their actions against Kalshi. pic.twitter.com/7uD6zjPlIX
— Mick Bransfield (@MickBransfield) April 1, 2026
Last year, Robinhood partnered with Kalshi, enabling it to offer prediction market event contracts. As a result, when Washington filed its lawsuit against Kalshi on Friday, Robinhood was likely to become collateral damage should the Evergreen State prevail.
Lawsuits are making predictions markets news with increasing frequency, as states take to the courts in an attempt to enforce state gambling laws. Prediction markets offer event contracts that are similar in many ways to gambling wagers. Prediction market operators, on the other hand, believe themselves to be above state laws as they are federally – not state – regulated.
Enjoying Covers content? Add us as a preferred source on your Google accountIn its Washington suit, Robinhood asks the court for an injunction, to “prevent further harm to Robinhood, the Court should enjoin Defendants from enforcing preempted Washington law against Robinhood in contravention of the United States Constitution.”
Courtroom déjà vu
There are currently more than a dozen state and tribal regulators battling it out with prediction market operators in the courts. In fact, there have been so many prediction markets lawsuits that some patterns are emerging.
For instance, the legal activity currently playing out in Washington follows the Massachusetts model. In September, Massachusetts Attorney General Andrea Joy Campbell filed a lawsuit against Kalshi in state court for illegal sports betting. Days later, Robinhood sued Massachusetts in federal court.
As the court cases become more and more predictable, there is really only one question that remains: How many prediction markets court cases will it take before the issue of state gambling laws and federal preemption makes it to the U.S. Supreme Court? Perhaps there should be an event contract for that.
