DraftKings pulls Utah prediction contracts after Kalshi charges

DraftKings withdrew sports, novelty, political and certain other prediction-market contracts from Utah on Oct. 28, the day the state brought 14 criminal charges against Kalshi and its co-founders, Tarek Mansour and Luana Lopes Lara. The company told customers that sports, novelty, political and certain other event contracts were no longer available to people physically located in the state.

The change was narrower than a complete departure from Utah. DraftKings continued to offer financial event contracts tied to stocks, commodities and cryptocurrency. Customers with existing positions in the restricted markets could keep them open until settlement, but could not initiate new positions while in Utah.

Utah’s case against Kalshi prompted the restrictions by DraftKings and other prediction-market operators, according to The Salt Lake Tribune. Attorney General Derek Brown said the state would continue to enforce its gambling laws against companies that bring gambling into Utah, saying: “Utah law is clear: gambling is illegal in our state.”

The state’s position rests on a constitutional bar on legislative authorisation of gambling and state laws making gambling illegal. On Oct. 20, the attorney general’s office separately filed a civil suit against KalshiEX and related entities, alleging the platform allowed Utah residents to wager on sports, elections, politics and other outcomes. The suit seeks to stop Kalshi from offering those contracts in Utah.

Kalshi has argued that the federal Commodity Exchange Act prevents state regulation of its platform. But U.S. District Judge Robert Shelby granted summary judgment to Utah in August, and the Tenth Circuit denied Kalshi’s request to block enforcement while it appealed on Sept. 8. That appeal remained pending.

The pullback extended beyond DraftKings. Fanatics Markets stopped all Utah trading on Nov. 4, as we reported, while FanDuel Predicts had already removed sports, political and novelty contracts on Oct. 30 but retained contracts linked to economic benchmarks and financial indicators.