Meta description: Connecticut’s Kalshi case remains pending after DCP accused Kalshi, Robinhood and Crypto.com of unlicensed sports wagering.

Tags: Kalshi, Connecticut Department of Consumer Protection, CFTC, Robinhood, Crypto.com, Sports Event Contracts

market_platform: Kalshi

category: Regulation

Connecticut’s enforcement fight with Kalshi has not produced a published injunction ruling. The public docket in KalshiEX LLC v. Cafferelli, No. 3:25-cv-02016, shows Kalshi sued Connecticut officials on December 3, 2025, after the state’s gaming regulator accused Kalshi, Robinhood Derivatives and Crypto.com of offering unlicensed sports wagering.

What is the Connecticut Kalshi case about?

The case is a direct test of whether Connecticut can apply its gambling laws to sports-event contracts listed by a federally regulated prediction-market exchange. Kalshi argues its contracts are regulated under the Commodity Exchange Act through the Commodity Futures Trading Commission. Connecticut’s Department of Consumer Protection says the sports contracts are wagers offered without a state license.

The Connecticut Department of Consumer Protection Gaming Division announced on December 3, 2025, that it had issued cease-and-desist orders to KalshiEX LLC, Robinhood Derivatives LLC and Crypto.com. The agency said the three platforms were “conducting unlicensed online gambling, specifically sports wagering,” and said none had a Connecticut license to offer sports betting.

DCP Commissioner Bryan T. Cafferelli framed the case as a state licensing matter, saying in the agency’s release that only licensed entities may offer sports wagering in Connecticut. DCP Gaming Director Kris Gilman went further on the agency’s theory of the product: “A prediction market wager is not an investment.”

Kalshi filed suit the same day in the U.S. District Court for the District of Connecticut against Cafferelli, Gilman, DCP and Connecticut Attorney General William Tong. The Justia docket identifies U.S. District Judge Vernon D. Oliver as the presiding judge and lists the cause of action under federal commodity-exchange regulation, 7 U.S.C. § 6(b).

Has Judge Vernon Oliver ruled on Kalshi’s injunction request?

The public docket does not show a published order denying Kalshi’s preliminary-injunction motion. Instead, it shows Kalshi filed the motion on December 5, 2025, Connecticut officials were ordered to refrain from enforcing the December 2 cease-and-desist letter while the motion remained pending, and Judge Oliver held a motion hearing on February 11, 2026.

That December 8 order matters because it set the interim ground rules. According to the District of Connecticut docket, Connecticut agreed not to take enforcement action against Kalshi over conduct described in the cease-and-desist letter until the court disposed of Kalshi’s preliminary-injunction motion. The same order set a January 9, 2026 response deadline for the state and a January 30 reply deadline for Kalshi.

The docket later recorded a February 18 transcript notice for the February 11 hearing. It also listed supplemental-authority notices in February, March, April and May, a common pattern in fast-moving litigation where other courts are deciding related questions. The docket entry retrieved through Justia says a more recent listing may be available from PACER, but the public docket summary does not itself report a final injunction ruling.

How does Connecticut’s position fit into the national fight?

Connecticut is one of several states arguing that sports-event contracts should be treated as gambling when offered to their residents. Kalshi’s response across state cases has been that its status as a CFTC-designated contract market puts its contracts under federal derivatives law, not state sportsbook licensing regimes.

The results have been mixed, which is the central legal fact for the industry. Kalshi won important relief in New Jersey: the U.S. Court of Appeals for the Third Circuit affirmed a preliminary injunction on April 6, 2026, in KalshiEX LLC v. Flaherty, No. 25-1922, holding that Kalshi had shown a reasonable chance of success on its argument that the Commodity Exchange Act preempts otherwise applicable state law.

New York went the other way. In KalshiEX LLC v. Williams, No. 1:25-cv-08846, U.S. District Judge Analisa Torres denied Kalshi’s preliminary-injunction motion in an amended opinion dated July 13, 2026. The New York Attorney General’s office and Governor Kathy Hochul described the ruling as a court victory against Kalshi in a July 8 statement, saying New York would continue to enforce its gambling laws against prediction-market platforms.

Utah also won a ruling allowing enforcement of its anti-gambling laws. The Associated Press reported on August 6, 2026, that U.S. District Judge Robert Shelby rejected Kalshi’s request to block Utah from applying those laws to prediction markets. That ruling added another state-side decision to a record that now turns heavily on forum, statutory interpretation and each court’s view of Commodity Exchange Act preemption.

What did the CFTC do in the Michigan dispute?

The CFTC intervened in a narrower Michigan dispute on July 14, 2026. In Release No. 9267-26, the commission said it stayed an emergency rule change proposed by Kalshi after a Michigan state court order directed the company to cancel certain previously executed trades involving Michigan residents. The CFTC also ordered Kalshi to fulfill the open trades in accordance with its normal practices.

That order did not purport to resolve every state-law challenge to Kalshi’s sports contracts. It addressed pending Michigan trades and the commission’s view that a registered derivatives exchange must maintain orderly trading and apply access criteria in a non-discriminatory way. The release said the Commodity Exchange Act requires the CFTC to provide a uniform national market in derivatives transactions.

The Michigan order still matters beyond Michigan because it shows the CFTC is willing to use emergency authority when a state-court order affects already executed trades on a registered exchange. For state regulators, the order does not answer the threshold question they are pressing in court: whether the contracts at issue are sports wagers subject to state gambling law.

What should prediction-market firms watch next?

The Connecticut docket is the next local milestone for that case, because Judge Oliver’s eventual preliminary-injunction ruling will determine whether DCP can resume enforcement against Kalshi while the merits litigation proceeds. The docket already shows Tribal Amici participating, giving the case a broader regulatory and sovereignty dimension beyond a two-party dispute between one exchange and one state agency.

For Kalshi, the practical stakes are larger than Connecticut. A durable New Jersey-style rule would strengthen the federal-preemption argument that CFTC-regulated event contracts cannot be blocked state by state. A New York- or Utah-style rule would strengthen state regulators’ position that sports contracts can be treated as gambling even when listed on a federally regulated exchange.

The industry’s near-term map is therefore fragmented. Connecticut’s case remains pending in the District of Connecticut, the CFTC’s July 14 order covers open Michigan trades, the Third Circuit has backed Kalshi in New Jersey, and courts in New York and Utah have allowed state gambling-law enforcement to proceed. The next published Connecticut order will show which side gains another citation in the national preemption fight.