Wisconsin Sues Robinhood Over Alleged Illegal Sports Event Contracts
Wisconsin sued Robinhood and four platforms for offering sports event contracts as illegal gambling, seeking injunctions under Wis. Stat. §945.03(1m). The state claims these financial-wrapped payouts tied to sporting outcomes breach state law, escalating regulatory risks for Robinhood’s prediction markets.
1. Lawsuit Filing
On April 24, 2026, the Wisconsin Department of Justice filed suit in Dane County Court against Robinhood and four other prediction market operators, including Kalshi and Coinbase, seeking both preliminary and permanent injunctions to block sports-related event contracts for in-state users.
2. Allegations Under Gambling Law
The complaint alleges that these platforms wrap wagers in financial products while tying payouts to sporting outcomes, violating Wis. Stat. §945.03(1m) and constituting a public nuisance by circumventing the state’s ban on unlawful commercial gambling.
3. Implications for Robinhood
The lawsuit could force Robinhood to suspend its sports event contract offerings in Wisconsin, adding to mounting regulatory pressure on its prediction market business and signaling potential challenges in other jurisdictions.