Baltimore Mayor Brandon M. Scott and the City Council filed separate lawsuits Thursday against prediction market operators Kalshi and Polymarket, arguing that both platforms function as unlicensed sportsbooks in violation of the city’s Consumer Protection Ordinance (CPO).
The complaints, filed in the Circuit Court for Baltimore City, allege that the two companies mislead customers about the legal status of their products while offering wagers on game winners, point spreads, point totals and player propositions — categories of bets typically associated with licensed sportsbooks.
Kalshi and Polymarket describe these transactions as “event contracts” traded on a peer-to-peer basis rather than house-set odds, a distinction the city disputes in its filings.
Additional defendants named
The lawsuit against Kalshi also names Robinhood, Webull and Coinbase, each of which offers sports event contracts through the Kalshi platform. The Polymarket complaint similarly extends to QCX, Blockratize and QC Tech.
“These companies are running sportsbooks without licenses and betting that a new label will put them above the law,” Mayor Scott said. “It won’t. Baltimore will not let multibillion-dollar companies put profits over people and harm our communities through illegal gambling.”
The city is represented by the Baltimore City Department of Law along with the law firm DiCello Levitt.
Consumer protection claims
Beyond the licensing issue, the lawsuits assert that Kalshi and Polymarket market their platforms in ways that create a false impression of lawful, regulated status, while making gambling products easily accessible to consumers. The city’s announcement pointed to risks for “vulnerable populations,” including young adults and individuals exhibiting problem gambling behavior.
“Kalshi and Polymarket cannot circumvent Baltimore’s consumer protections by repackaging gambling as something else or claiming federal regulation puts them beyond the reach of our laws,” said City Solicitor Ebony M. Thompson. “The City will continue to use its consumer protection authority to stop deceptive and unlawful conduct and hold companies accountable when they put our residents at risk.”
“Allowing prediction market companies to evade gambling laws would set a dangerous precedent far beyond Baltimore,” said Adam Levitt, DiCello Levitt founding partner. “These companies cannot be permitted to use new terminology and new technology to operate outside the rules designed to protect consumers and communities.”
The city’s claims center on unfair, abusive and deceptive trade practices under the CPO. Baltimore is seeking civil penalties, injunctive relief, restitution for affected consumers, disgorgement of profits and other relief available under the ordinance.
Maryland’s licensing framework
Under state law, prospective sports betting operators must apply through the Maryland Lottery and Gaming eLicensing system, register with the Department of Assessments and Taxation, pass a background check administered by the Sports Wagering Application Review Commission and pay applicable fees. Approved operators are also required to share 20% of taxable revenue with local government.
The Maryland Lottery and Gaming Control Commission had previously issued cease-and-desist letters to Kalshi, Robinhood and Crypto.com in April 2025, directing them to stop offering sports event contracts in the state.
Kalshi responded by filing suit in the US District Court for the District of Maryland, arguing that its contracts fall exclusively under the Commodity Exchange Act and are exempt from state sports wagering law.
In August 2025, Judge Adam Abelson denied Kalshi’s request for a preliminary injunction, finding that the company had not shown a likelihood of success on its federal preemption claim.
Separately, Maryland Lottery and Gaming Control Commission Secretary John Martin issued a memo last December warning licensed gaming operators against entering the prediction markets space, cautioning that doing so could put their existing licenses at risk.
Baltimore’s suits against Kalshi and Polymarket follow a string of rulings that have favored state and local regulators over prediction market operators, including in New York, Wisconsin and Utah, where platforms were denied injunctions that would have blocked gaming enforcement actions.
Original article: https://www.yogonet.com/international/news/2026/08/17/125902-baltimore-sues-kalshi-and-polymarket-over-unlicensed-sports-betting
