Judge temporarily blocks Kalshi from allowing Michigan residents to place online sports bets

A Michigan judge has temporarily blocked prediction market platform Kalshi from allowing residents to place sports bets online for the next two weeks.

On Monday, Ingham County Circuit Court Judge Rosemarie Aquilina ruled in favor of Michigan, ordering the temporary injunction through July 13.

In the four-page ruling, Aquilina wrote that Kalshi violated the state's gaming industry by allowing people aged 18 to place wagers, as opposed to Michigan's age requirement of 21 and older. Aquilina also wrote that the platform gave a "massive and unfair advantage over entities that comply with Michigan's regulatory structure."

"If Kalshi is allowed to continue to offer sports program wagers, the potential irreparable harm on Michigan's youth would be profound," Aquilina wrote.

"Our gambling laws exist to protect Michiganders from unlicensed, predatory operations, and failing to comply with them carries serious legal consequences," said Nessel in a statement. "I am proud of the attorneys in my office who not only kept this case in state court but also secured an order protecting residents as this litigation moves forward. We remain committed to enforcing a level playing field for all gambling platforms in Michigan and ensuring that companies cannot evade accountability or exploit consumers under the guise of a prediction market."  

CBS News Detroit reached out to Kalshi for comment on Monday and is awaiting a response.

The decision came after a federal judge remanded the case back to the state court on June 25. In March, Michigan Attorney General Dana Nessel filed a lawsuit against Kalshi for allegedly violating the state's Lawful Sports Betting Act by allowing residents to participate in sports betting under the form of trading event contracts. 

In response, Kalshi requested that the case be transferred to federal court, arguing that the federal court had jurisdiction. This prompted Nessel to file a motion to remand.

U.S. Judge Paul Maloney wrote that the case belonged in state court because the lawsuit cites a violation of Michigan law, and Kalshi would have to show that federal law applied. Although Maloney moved the case back to the state, he did not grant Michigan's request for costs and fees.

Kalshi is ordered to use a third-party geolocation services provider licensed by the state Gaming Control Board to ensure compliance. If the company uses a geolocation provider licensed in another state, Michigan must determine whether the provider can comply with Michigan's regulations.

The platform is ordered to pay a $120,000 fine for each day it does not comply with those requirements.