New Mexico Attorney General Files Lawsuit Against Kalshi
Jesse M. Cox Published 08/06/2026
Add New Mexico to the list of states that are going to court in a fight over who has regulatory control over sports-event contracts offered by prediction market sites. New Mexico Attorney General Raúl Torrez announced that the New Mexico Department of Justice (NMDOJ) has filed a lawsuit against Kalshi. The suit argues that the company is unlawfully offering online sports betting in New Mexico while attempting to evade state gaming laws.
The lawsuit alleges that Kalshi has created an online platform that functions as a sportsbook. It's allowing users to place wagers on sporting events while operating outside New Mexico’s licensing and regulatory requirements.
New Mexico alleges that sports event contracts are sports betting
The basis of the NMDOJ lawsuit isn't unfamiliar to anyone who has been monitoring the ongoing battle between state governments and prediction market sites. It's simple, really. The state regulators believe that sports-event contracts are actually sports betting. And that being the case, these sports-event contracts should be subject to the rules and regulations of a state's sports betting laws.
According to the lawsuit, Kalshi is offering these sports-event contracts to New Mexico residents without obtaining any gaming license from the State. It is also allowing participation by individuals between the ages of 18 and 20. New Mexico’s minimum gaming age is 21.
The NMDOJ further alleges that Kalshi’s operations undermine New Mexico’s public policy regarding gaming. They also threaten the state’s sovereign authority to regulate gambling activities within its borders.
Torrez is set to defend New Mexico's state rights
The lawsuit seeks injunctive relief to halt Kalshi’s alleged unlawful operations in New Mexico. It's also seeking to prevent the company from continuing to offer sports-related wagering through its prediction market platform.
“New Mexico has a longstanding and carefully balanced system for regulating gaming that protects consumers, ensures accountability, and respects tribal sovereignty,” Attorney General Raúl Torrez said in a statement. “The only lawful gaming in New Mexico operates either under tribal-state gaming compacts or under strict state regulations to ensure honest gaming free from corruption, and licenses gaming operators only after they explain how they plan to address compulsive gambling.
"Kalshi has ignored that framework entirely while offering online sports betting within the state. We are filing this lawsuit to protect the integrity of our laws, our regulatory system, and most importantly, consumers.”
State tribal organizations are already suing Kalshi
The NMDOJ lawsuit follows closely on the heels of a lawsuit filed by New Mexico's tribal organization against the prediction market company. Last month, four New Mexico native tribal organizations filed a federal lawsuit against Kalshi. The suit alleges that the prediction market site is offering illegal sports betting. According to the suit, Kalshi, by offering access to sports-event contracts on tribal land, is breaking federal and tribal laws.
The four tribes - the Pojoaque Pueblo, Sandia Pueblo, Isleta Pueblo, and the Mescalero Apache Reservation - all are operators of prominent land-based casinos in New Mexico. Their complaint alleges that Kalshi’s online gaming activities within the borders of tribal land run afoul of tribal ordinances, the federal Indian Gaming Regulatory Act of 1988, and tribal gambling compacts with New Mexico.
The suit is asking the court to order Kalshi to stop offering internet-based sports betting on tribal land. It is also requesting a requirement that Kalshi pay civil penalties to the four tribes. These penalties would be for “willful and intentional” violations of Indigenous gambling ordinances.