New York Gaming Commission Seeks Court Order to Force Kalshi Compliance

The New York State Gaming Commission has asked a Manhattan court to force prediction market operator Kalshi to comply with investigative subpoenas.

The regulator filed a verified petition in the Supreme Court of the State of New York, County of New York, naming Kalshi Inc. and KalshiEX LLC as respondents.

The Commission said it needs the records to "determine whether to issue civil penalties against Kalshi and others for violations of the Racing Law," the statute governing sports wagering in New York.

The petition alleges Kalshi has "operated a massive enterprise in New York designed to enable individuals to place wagers."

The subpoenas, issued on July 31, 2026, under Section 104(7) of the Racing, Pari-Mutuel Wagering and Breeding Law, seek records on Kalshi's sports-event contracts, its offerings to New Yorkers under the age of 21, advertising that describes its products as wagers or bets, and the company's ownership and corporate structure.

The Commission said Kalshi "has flatly refused to produce any documents" in response to certain requests and "refuses to comply with key Subpoena requests necessary to assess the scope of Kalshi's operations in New York."

It told the court it "will be irreparably harmed if Kalshi is permitted to defy the lawfully issued Subpoenas."

The petition was received by the court's electronic filing system on October 22, 2026, and became public on October 23 after gaming attorney Daniel Wallach shared pages online.

This action follows a July 31 lawsuit announced by Attorney General Letitia James and Governor Kathy Hochul accusing Kalshi of running an unlicensed gambling operation, seeking to halt its New York business and secure restitution for consumers.

"No matter what they call themselves, prediction markets like Kalshi are gambling platforms, plain and simple," James said at the time.

Governor Kathy Hochul said that "Kalshi has chosen to ignore New York's gaming laws, which exist to protect consumers."

The state's July lawsuit seeks fines equal to three times Kalshi's gains, with the petition putting the claimed damages at "$36,000,000,000.00 at minimum pending accounting."

Kalshi has consistently argued its sports contracts are financial instruments overseen by the Commodity Futures Trading Commission, not bets.

The CFTC sued New York in April in the U.S. District Court for the Southern District of New York, seeking a declaratory judgment that federal law gives it exclusive authority over event contracts.

"New York is the latest state to ignore federal law," CFTC Chairman Michael Selig said when that suit was announced, adding that "the CFTC will not allow overzealous state governments to undermine the agency's longstanding authority over these markets."

After New York sued Kalshi, the CFTC used its emergency authority to order the exchange to keep operating in the state, with Selig saying that "Congress did not intend for derivatives exchanges to be regulated under a patchwork of state gaming laws."

Kalshi CEO Tarek Mansour has said the company is operating under federal rules.

The subpoenas followed a July 7 ruling where District Judge Analisa Torres denied Kalshi's motion for a preliminary injunction against the Commission.

New York has since filed suit against prediction market Polymarket as well.

Other states including Utah, which is seeking to recover up to $61.2 million, and Connecticut have also taken legal action against Kalshi.

No hearing date or ruling on the subpoena petition had been reported, and Kalshi had not issued a public response.