Louisiana sues 10 prediction markets, wins order to halt them

Louisiana sued 10 prediction market firms on November 12 and won a court order to stop their event contracts in the state within hours. A judge told Kalshi, Coinbase, Gemini and seven others to halt, pending a hearing set for November 30.

Attorney General Liz Murrill filed the case in the 21st Judicial District Court in Tangipahoa. Judge Jeffrey Johnson granted a temporary restraining order the same day, before the companies had argued their side, according to the gaming outlet CDC Gaming Reports and the legal publication Law360, which listed the petition and the order among the court filings.

What the court ordered

The restraining order runs for 10 days unless the judge extends it. It bars the named firms from offering event contracts in Louisiana without a state gaming license. That ban covers contracts tied to sports, elections and awards. The order also tells the companies to block Louisiana residents from reaching their platforms, a step the industry calls geofencing. It forbids them from telling customers the contracts are licensed or legal in the state. By one gaming lawyer's reading, the ban reaches far more than taking wagers. It also covers offering, listing, clearing and settling the contracts.

Murrill did not mince words. She wrote on X that the platforms had "violated our laws with impunity" and said she was acting to "restore the rule of law in Louisiana." In a separate post she added that illegal gambling "is a crime and is subject to jail time and significant penalties." The petition does not put a dollar figure on the penalties the state is seeking.

Who Louisiana named

Defendants include Kalshi, Polymarket, Robinhood, Coinbase, Crypto.com, Gemini, Underdog, Novig, ForecastEX and ProphetX. Several are crypto companies. Coinbase and Gemini rank among the largest US crypto exchanges, and Polymarket settles its markets in stablecoins. The rest range from sports apps to newer venues built around event trading.

Event contracts let people stake money on a yes or no outcome, such as whether a team wins a game or who takes an award. The platforms say these are financial products, not bets, because they trade like futures and clear through federally registered exchanges. Louisiana sees the same product as a wager in a suit and tie.

Daniel Wallach, a gaming lawyer who tracks these cases, called it the first time a state has sued almost the whole industry in one action, and the first to win a restraining order on the day of filing. The scope is the point. One filing, 10 companies, one courthouse. Coinbase and Kalshi have argued in other venues that the federal commodities regulator, not the states, should oversee these products.

A federal fight runs underneath

Underneath the Louisiana case sits a national question. Do states control gambling inside their borders, or does federal law win out when a contract trades on a registered exchange? Kalshi has pushed the federal answer hard. It sued Murrill and other state officials on October 23 in the US District Court for the Western District of Louisiana, arguing that the Commodity Futures Trading Commission holds exclusive authority over its event contracts and that those contracts are not gambling.

Federal rulemaking leans the same way. In October, CFTC Commissioner Michael Selig put forward two rules that define event contracts as swaps while carving out casino-style gambling products left to the states. Kalshi cites them in its complaint. Where a sports market falls between those two boxes is the fight. Kalshi argues a contract that trades on a registered exchange and clears like a future looks nothing like a casino bet. Louisiana argues the label does not change what the customer is doing.

Both sides now have a filing on the table. Murrill wants a state court to enforce Louisiana's gambling laws. Kalshi wants a federal court to shield a federally regulated exchange. The November 30 hearing gives the state claim its first real test.

Louisiana is not the first

States have been circling prediction markets all year. New York Attorney General Letitia James sued Kalshi in July, calling it an illegal, unlicensed gambling operation and accusing it of letting 18 to 20 year olds trade below the state's betting age of 21. James had already filed similar petitions against Coinbase and Gemini units in April. Wisconsin sued Kalshi, Polymarket, Robinhood, Crypto.com and Coinbase that same month. By the summer, at least four states, Massachusetts, Michigan, Nevada and Washington, had won court orders limiting Kalshi.

On the other side, federal regulators have pushed back. The CFTC has challenged state oversight in at least nine states, and a federal judge blocked Minnesota's ban on prediction markets days before it was set to take effect. The result is a patchwork, with state and federal courts pulling in different directions.

Money explains the stakes. Kalshi takes in more than $1 billion a year from sports contracts alone, about 90 percent of its estimated revenue, by Decrypt's reporting. A state-by-state shutdown would bite. That is why the industry is reading the Tangipahoa docket so closely, and why Kalshi raced to federal court before most states even moved.

What to watch

For now the order is temporary. The real test comes on November 30, when Johnson decides whether to turn the block into a longer preliminary injunction. Watch whether Louisiana residents actually lose access first, because the order demands geofencing inside the state.

Federal law matters more in the long run. If courts keep treating these contracts as regulated swaps, state gambling suits get harder to win, whatever a local judge orders first. The question is landing as the Trump administration reshapes the SEC and CFTC. None of the 10 firms had settled with Louisiana as of the order.

The pattern is set. Ten firms. One filing. One day. No state had tried that before.