TLDR Kalshi filed a federal lawsuit against Minnesota after Gov. Tim Walz signed a second prediction market ban bill, SF 3432, on May 26, 2026. The lawsuit claims Minnesota’s ban violates federal law by overriding the CFTC’s exclusive authority over event contracts. Kalshi argues the state is effectively criminalizing activity that federal regulators have already approved. The suit also includes a First Amendment claim, saying Minnesota cannot ban advertising for federally lawful products. Similar prediction market lawsuits are active in Arizona and Rhode Island, with federal courts so far siding with federal jurisdiction.
Kalshi has filed a federal lawsuit against the state of Minnesota, targeting a new law that bans prediction markets in the state. The lawsuit was filed after Governor Tim Walz signed Senate File 3432 into law on May 26, 2026.
The move follows a separate lawsuit the Commodity Futures Trading Commission filed against Minnesota just days earlier over a different prediction market bill.
What the New Minnesota Law Does
Minnesota’s SF 3432 repealed and replaced earlier prediction market provisions from SF 4760, a bill Walz had already signed earlier in May. SF 3432 also expanded the state’s broader public safety package.
The new law is set to take effect on August 1, 2026.
Kalshi named Minnesota Attorney General Keith Ellison, Governor Tim Walz, and Alcohol and Gambling Enforcement Division Director Jon Anglin as defendants.
The company is asking a federal court for declaratory and injunctive relief to stop the law before it kicks in.
Why Kalshi Says the Law Is Illegal
Kalshi’s core argument is that the Commodity Exchange Act gives the CFTC exclusive jurisdiction over event contracts. The company says Minnesota’s law cuts into that federal authority.
Kalshi operates a federally designated contract market. It says the new state law would treat the