On 1 September, Ingham County Circuit Court Judge Rosemarie Aquilina signed a preliminary injunction barring KalshiEx, LLC from offering sports wagers to anyone in Michigan. The order converts a temporary restraining order issued in June into a standing block that stays in effect until a final ruling in the case Attorney General Dana Nessel filed in March, alleging the company runs an unlicensed online sportsbook in violation of the state’s Lawful Sports Betting Act.
The prohibition is broad, but it is the kind of order state gambling regulators routinely seek. The findings behind it are the more consequential document. They are the most specific judicial statement yet of what a state says the product costs, and they name the youngest customers first.
The seven findings
Aquilina wrote that Michigan and “its most vulnerable citizens are suffering and will continue to suffer immediate and irreparable harm absent relief from being exploited by Kalshi’s sports betting operation masquerading as an investment opportunity.” She then listed why.
Michigan’s legal gaming industry admits wagerers at 21. Kalshi allows trading from 18, so “the potential irreparable harm on Michigan’s youth would be profound.” Second, “Kalshi takes advantage of serious mental health issues without providing the protections that Michigan’s regulatory structure was designed to do.” Third, it “eludes the comprehensive patron protection mechanisms” in that framework. Fourth, non-compliance gives it “a massive and unfair advantage over the entities that comply with Michigan’s regulatory structure.” Fifth, it “is undercutting Michigan’s funding for schools, compulsive gambling prevention, economic development, and first responders.” Sixth, Detroit funds law enforcement, public safety, youth programs and infrastructure out of gaming taxes. Seventh, it deprives tribes of revenue they need to run their governments “while also ignoring their sovereignty.”
Those are the state’s claims accepted for the purposes of a preliminary injunction, not a final judgment, and Kalshi disputes them. But the list is also a map of where licensed gambling money currently goes, and what is not being replaced if the same products can be sold outside that system.
What the order actually bans
The injunction bars offering, listing, matching, executing, clearing, settling or facilitating internet sports betting contracts for anyone in Michigan; accepting deposits or stakes; creating, verifying or funding accounts for those products; and advertising or soliciting them — explicitly including websites, mobile apps, email, push notifications, social media, influencers, affiliates and paid placements. It extends to products “functionally similar” to internet sports betting: single-game bets, teaser bets, parlays, over-unders, moneylines, pools, exchange betting, in-game betting, proposition bets and straight bets.
Compliance runs through geolocation. Kalshi must use a third-party provider licensed by the Michigan Gaming Control Board, under the board’s Technical Bulletin 2024-03. If the court later finds the company failed to geolocate adequately, the fine is $500,000 per day — the order states the reason is that poor geolocation “may limit Plaintiff’s ability to identify ill-gotten gains for the purpose of disgorgement.” Kalshi must also serve the order on every futures commission merchant that makes its sports event contracts available to customers, within three business days, and will not be held liable for what those firms do after notice.
Kalshi’s answer
Kalshi’s head of communications, Elisabeth Diana, told Michigan Advance: “It’s no surprise that we disagree with the state’s decision and will fight it in court. Kalshi is subject to exclusive federal jurisdiction. We won’t be bullied by interests that care more about protecting their monopolies than their consumers.”
In a letter to the Attorney General’s office, Kalshi attorney Andrew Porter wrote that the company still holds that event contracts on federally regulated exchanges fall under exclusive CFTC jurisdiction, “but we recognize that position is contested.” He noted that Polymarket, Robinhood and Coinbase were all denied federal court orders that would have stopped Michigan from acting in state court, and argued that the alleged harm to 18-to-20-year-olds “is inflicted equally by other market participants that presently are allowed to operate in Michigan.” Kalshi reserved the right to move to dissolve the injunction if the state does not pursue its competitors.
That is the asymmetry worth watching. Michigan’s Department of Attorney General did not answer Michigan Advance’s questions about whether it plans similar suits against Kalshi’s competitors — so the exemption Kalshi describes as industry-wide is, for now, being litigated one defendant at a time.
The vocabulary question
Three months before the order, the National Council on Problem Gambling announced a $2m, two-year investment from Kalshi and a new membership subcategory for “Financial Services & Trading,” with Kalshi joining at Platinum level. NCPG’s own release describes the work as “trader health and safety.” The Michigan order, written in a court that hears the state’s gaming cases, uses a different vocabulary: gambling harm, mental health, youth, sovereignty, prevention funding. Both documents are attempts to name the same activity.
The injunction is not a final decision, and the underlying question — whether a federally registered exchange must follow state gambling law — is heading for the Supreme Court, where the Third and Ninth Circuits have already split. What Michigan’s order establishes in the meantime is a record: specific, reviewable findings about who is allowed to trade, what protections are absent, and which public accounts absorb the difference.