Wisconsin Sues Robinhood Over Alleged Illegal Sports Betting Contracts
Wisconsin DOJ filed lawsuits in Dane County court against Robinhood, Kalshi, Coinbase, Polymarket and Crypto.com, alleging their sports-related event contracts violate the state’s gambling ban and seeking preliminary and permanent injunctions. The complaint argues payouts tied to sporting outcomes constitute illegal betting, increasing regulatory scrutiny on Robinhood’s prediction market operations.
1. Lawsuit Details
On April 24, the Wisconsin Department of Justice filed lawsuits in Dane County Court against Robinhood and four other platforms, alleging their sports-related event contracts violate Wis. Stat. § 945.03(1m) and constitute a public nuisance. The state seeks preliminary and permanent injunctions to halt in-state marketing and trading of these contracts.
2. Broader Regulatory Context
This action follows New York’s recent lawsuit against prediction market providers and intensifies a broader regulatory battle over state versus federal oversight of sports-linked contracts. Robinhood faces potential suspension of prediction market offerings in Wisconsin, rising compliance costs and mounting pressure for uniform federal regulation by the CFTC.