What Have Courts Said About This?

The State of Washington brought an action against KalshiEX in King County Superior Court earlier this year.  Washington argued that betting on prediction markets or sports event contracts constitute gambling, and thus, platforms like KalshiEX and Robinhood must have gambling licenses to operate in Washington.  A King County Superior Court ruled in July 2026 (with an amended order in August 2026) that the State is likely to prevail on the merits of its request, finding that this conduct constitutes illegal gambling and granted an Order that preliminarily enjoined KalshiEX. 

The State of Nevada also previously sought to shut down prediction markets. Robinhood Derivatives filed a complaint in the U.S. District Court of Nevada, seeking to enjoin the State of Nevada from stopping its operations.  The Nevada federal court ruled in favor of the State of Nevada, effectively denying Robinhood’s request for injunctive relief.  In August 2026, after an appeal from Robinhood, the Ninth Circuit Court of Appeals upheld the decision by Nevada. 

In short, these courts have found that the sports events contracts or sports prediction markets constitute gambling, and because Robinhood or Kalshi were not properly licensed to operate gambling in those states, they engaged in illegal conduct.

While Nevada and Washington courts have made rulings, other states that also do not allow online gambling for sports include Alabama, Alaska, California, Georgia, Hawaii, Idaho, Minnesota, Mississippi, Nebraska, New Hampshire, New Mexico, North Dakota, Oklahoma, South Carolina, South Dakota, Texas, and Utah.

Can Israels & Neuman Help Recover These Losses?

The securities law firm of Israels & Neuman PLC represents clients in all 50 states, and currently represents a Washington resident who lost money gambling through Robinhood Derivatives.  Washington law provides that persons who lose money from illegal gambling operations can sue the operators for gambling losses.  See R.C.W. 4.24.070 and 9.46.200.  Nevada law also provides that it is illegal to “Knowingly to entice or induce another to go to any place where a gambling game is being conducted or operated in violation of the provisions of this chapter, with the intent that the other person play or participate in that gambling game”. See NRS 465.070.

Many of these platforms have arbitration clauses in their account agreements.  If you are considering suing over any sports gambling losses, contact an attorney at Israels & Neuman, PLC. We regularly represent consumers in all 50 states in arbitration.  Give us a call to find out more about your rights and options to recover your losses.

View the King County Order Here

View the Washington Statutes on Gambling Here and Here

Call Israels & Neuman for a Free Consultation

If you lost $25,000 or more gambling on sports through Robinhood, Kalshi, or other similar platforms in Washington, Nevada, or other states that do not allow online gambling for sports, contact the law firm of ISRAELS & NEUMAN at (206) 795-5798 or (720) 599-3505 for a Free evaluation of your case.