A Michigan court has extended restrictions preventing Kalshi from offering sports-related event contracts in the state, with the prediction market operator now facing penalties of up to $500,000 per day if it fails to meet strict geolocation requirements.
Ingham County Circuit Court Judge Rosemarie Aquilina issued a preliminary injunction on September 1, replacing temporary restrictions imposed earlier in the dispute. The order will remain in force until the court issues a final ruling in Michigan’s case against Kalshi.
Under the injunction, Kalshi is prohibited from offering, matching, executing, clearing or settling contracts that qualify as internet sports betting for people located in Michigan. The restrictions also cover taking deposits connected to those products and advertising or promoting sports contracts to Michigan residents.
The court specifically listed products such as single-game markets, parlays, over-under contracts, moneyline wagers, proposition bets, in-game betting and exchange betting among the activities covered by the order.
Strict geolocation controls imposed
Kalshi must use a third-party geolocation service licensed by the Michigan Gaming Control Board and capable of meeting the regulator’s technical requirements.
If the court determines that Kalshi has failed to comply with those geofencing rules, the company can be fined $500,000 for every day of non-compliance.
Kalshi was also ordered to provide copies of the injunction within three business days to futures commission merchants that make sports contracts processed through its exchange available to their customers.
The court said Kalshi would not automatically be responsible for the subsequent conduct of those merchants because it does not control their customers or possess information about where those customers are located.
Court cites age limits and state gaming protections
Aquilina found that Michigan could suffer immediate and irreparable harm if Kalshi continued offering its sports products while the lawsuit remained unresolved.
One of the key issues identified by the court is the difference between Michigan’s sports betting age requirement and Kalshi’s platform rules. Michigan requires sports betting customers to be at least 21, while Kalshi permits participation from age 18.
The judge also pointed to consumer safeguards within Michigan’s licensed gambling system, arguing that Kalshi operates outside requirements imposed on state-regulated sportsbooks.
Financial effects were another factor. According to the order, gambling revenue in Michigan supports areas including schools, problem gambling programs, economic development and first responders. Detroit also uses gaming tax revenue for public safety, law enforcement, infrastructure and youth programs.
The court additionally said unlicensed sports markets could affect tribal gaming revenues and tribal governments.
Michigan dispute forms part of wider Kalshi battle
Michigan Attorney General Dana Nessel filed the lawsuit against Kalshi in March 2026 on behalf of the state and the Michigan Gaming Control Board. The state argues that Kalshi’s sports event contracts constitute internet sports betting under Michigan law and therefore require state authorization.
Kalshi has maintained in legal disputes around the US that its event contracts fall under federal commodities regulation because the exchange is overseen by the Commodity Futures Trading Commission.
That question has produced conflicting court decisions and an expanding dispute over whether states can apply their gambling laws to federally regulated prediction markets.
Michigan’s latest order arrived shortly after the US Court of Appeals for the Ninth Circuit rejected Kalshi’s attempt to prevent Nevada regulators from enforcing state gaming laws against its sports contracts. The appellate court concluded that Kalshi had not established that federal commodities law displaced Nevada’s authority over the products.
The Michigan injunction now keeps Kalshi’s sports offering unavailable in the state while the underlying lawsuit continues.