- Baltimore filed consumer-protection suits Thursday against Kalshi and Polymarket in the Circuit Court for Baltimore City.
- The Kalshi complaint also names its brokerage partners Robinhood, Webull and Coinbase as defendants.
- The city seeks civil penalties, restitution, disgorgement and an order barring transactions from Baltimore residents.
- Maryland’s own enforcement against Kalshi remains paused while the Fourth Circuit weighs a preemption appeal argued in May.
BALTIMORE – Baltimore on Thursday sued Kalshi, Polymarket and three brokerages that carry Kalshi’s sports contracts, alleging under the city’s Consumer Protection Ordinance that the platforms run unlicensed sports betting and misrepresent its legality.
The Claim Runs On Unfair And Deceptive Trade Practices
The city filed two separate complaints in the Circuit Court for Baltimore City, one against Kalshi and one against Polymarket, alleging unfair, abusive or deceptive trade practices under the ordinance. Both were brought in the name of the City of Baltimore by City Solicitor Ebony M. Thompson, and both demand a jury trial. The city is asking for civil penalties, an injunction, restitution for affected consumers and disgorgement of profits.
According to the complaints, Baltimore residents can back moneylines, point spreads, point totals, player statistics and other propositions a licensed book would list. The city argues that labeling those positions event contracts or prediction-market trades does not move them outside Maryland gambling law.
Maryland is one of the states with online sports betting, and the city says the defendants compete with licensed operators while skipping the licensing, taxation, responsible-gambling duties and consumer protections those operators carry.
“These companies are running sportsbooks without licenses and betting that a new label will put them above the law. It won’t,” Mayor Brandon M. Scott said.
Thompson said the two operators “cannot circumvent Baltimore’s consumer protections by repackaging gambling as something else.” The city’s team includes Thompson, Sara Gross and Thomas Webb of the Baltimore City Law Department, with outside counsel from DiCello Levitt.
The Complaint Pulls In Three Brokerages
The Kalshi complaint reaches past the exchange to the apps that carry its contracts, naming Robinhood Markets Inc., Robinhood Derivatives LLC, Webull Corporation, Webull Financial LLC and Coinbase Financial Markets Inc. as defendants alongside KalshiEX LLC and Kalshi Inc. Each of the three firms partnered with Kalshi to run a prediction-market hub on its own platform, and Robinhood Derivatives is a futures commission merchant rather than an exchange.
A theory that holds those firms to a city’s consumer-protection standard would reach any brokerage carrying sports event contracts in a jurisdiction with a comparable ordinance.
The city also goes after the packaging. Kalshi and Robinhood offer parlays on their platforms, according to the complaint, which treats those positions as the sports wagers a licensed book sells under a different name. The distinction is thin at the point of sale, where customers see an interface close to what licensed books and offshore online gambling sites for USA players put in front of them. The deception counts turn on what those customers were told rather than on where the contracts trade.
Maryland’s Own Case Sits At The Fourth Circuit
The filing lands while the state’s enforcement is on hold. Kalshi sued in federal district court in Maryland after the state’s gaming regulator determined it was taking sports wagers without a Maryland license, arguing that its sports-event contracts fall exclusively under the Commodity Exchange Act.
U.S. District Judge Adam Abelson turned the exchange down on Aug. 1, 2025, refusing preliminary injunctive relief on a finding that Kalshi was unlikely to win on preemption and that the two regimes operate “in tandem.” Kalshi appealed, and the regulator has held off on licensing enforcement for the duration.
The Fourth Circuit heard argument in Kalshiex LLC v. John Martin, No. 25-1892, on May 7, 2026, in Richmond, Va. The appeal asks whether the Commodity Exchange Act preempts Maryland’s gambling laws as applied to exchange-traded sports event contracts.
That pause is what makes the municipal route useful. Baltimore is not asking a court to enforce a state licensing regime. It is asking for penalties under a city trade-practices ordinance, on a state-court track that does not wait on the federal appeal, and against the two prediction markets selling sports contracts plus the brokerages that carry them.
Kalshi rejected the premise. The suit is “nothing more than an effort to relitigate the same case that’s currently under appeal before the Fourth Circuit,” the company said, adding that it “is not violating any consumer protection laws” and “it’s operating lawfully under the exclusive jurisdiction of its federal regulator.”
The Fourth Circuit has not issued a decision in the appeal, and the agreement holding off state enforcement runs until it does.