Baltimore Sues Kalshi, Polymarket With Sweeps Case Playbook

Baltimore sued Kalshi and Polymarket on August 13, 2026 using the same city ordinance, the same city solicitor and the same outside law firm it aimed at six sweepstakes operator groups in March. Kalshi moved its case to federal court the next day; the sweepstakes defendants took seven weeks.

We read both complaints and the new federal docket rather than the write-ups. These filings matter to sweepstakes players for a reason that has nothing to do with sports betting: Baltimore is running the same municipal consumer-protection theory against a second industry that claims its product is not gambling, and the sweepstakes version of that fight is more than five months old without a judge having settled which courthouse hears it.

What exactly did Baltimore file?

Two separate complaints, minutes apart, both in the Circuit Court for Baltimore City on the morning of August 13, 2026.

Both complaints run on the Baltimore Consumer Protection Ordinance, which bars unfair, abusive or deceptive trade practices at Baltimore City Code Art. 2, § 4-2 and, at § 4-1, takes its definition of those practices from the Maryland Consumer Protection Act. The Kalshi complaint stacks eight counts, alternating deceptive-practice and unfair-practice theories across the four defendant groups.

The money is in how the penalty is counted. Each count pleads that the City is entitled to civil penalties of up to $1,000 under Art. 2, § 4-4 for each violation and for each day a violation was committed, and the demand for relief asks for the maximum statutory penalty available under § 4-3(a) for every violation. Baltimore also asks for an injunction ordering the platforms to stop accepting transactions from Baltimore residents, disgorgement of what it calls ill-gotten gains, and restitution to Baltimore consumers. A jury trial is demanded.

The core allegation is one sweepstakes players will recognise: that a product is being labelled as something other than gambling. The complaint argues the Kalshi platform "plainly facilitates 'sports wagering' as defined under Maryland law", citing Md. Code Ann., State Gov't § 9-1E-01(j).

What do the complaints say about who loses money?

Three allegations stand out, and all of them are the City's characterisations rather than findings by any court.

On age, the complaint states that Maryland restricts sports wagering to people 21 and older, citing Md. Code Regs. 36.10.13.44, and alleges the defendants operate "in complete disregard" of that regime by "permitting, for example, eighteen-year-olds to bet on sports on the Kalshi platform", footnoting Kalshi's own FAQ page as visited on July 27, 2026.

On outcomes, the complaint leans on a Roosevelt Institute analysis published July 7, 2026 for its hard numbers: that retail traders on Kalshi have lost $583.5 million, and that more than two thirds of that, $371.6 million, came from sports alone.

It also alleges twice that "Kalshi recently admitted that nearly three times as many people lose money as make money on its platform", and the two versions do not cite the same source. In the introduction the City footnotes that claim to the Roosevelt analysis. Where the same allegation is pleaded in the body, at paragraph 107, the footnote instead points to a Wall Street Journal article of May 3, 2026. A reader should treat the ratio as the City's allegation with an unsettled provenance, not as a documented admission.

No defendant has answered either complaint. Kalshi's only filing so far is its notice of removal, and there is no answer from Robinhood, Webull, Coinbase or Polymarket on any public docket we could read. The Polymarket case has since followed Kalshi's into federal court, and by the same route: QCX LLC filed its own notice of removal from the Circuit Court for Baltimore City on August 17, 2026, docketed at 1:26-cv-03253 before Judge Richard D. Bennett, with the state-court complaint against Blockratize Inc., QC Tech LLC and QCX LLC entered behind it. A companion docket, 1:26-cv-03252, appeared the same day and still holds no entries. No document is downloadable on either, so we can say who removed the case and not on what grounds.

Why does a prediction-market case matter to sweepstakes players?

Because it is the same plaintiff running the same play, and the sweepstakes version is further along.

Baltimore filed against the sweepstakes operators on March 4, 2026 in the same circuit court, through City Solicitor Ebony Thompson, with DiCello Levitt LLP as outside counsel, on the same Consumer Protection Ordinance. Six defendant groups are on that docket, and they are the companies behind Chumba Casino, LuckyLand Slots, McLuck, Pulsz, Stake.us, High 5 Casino and Fortune Wins. Our Baltimore sweepstakes casino lawsuit report covers that case in full.

That case went to federal court on April 23, 2026, when PTT, LLC and High 5 Entertainment, LLC filed the notice of removal, and it has been stuck on the removal question ever since. Judge Brendan Abell Hurson granted a stipulated briefing schedule on May 20, Baltimore moved to send the case back to state court on May 21, and the last entry in the public federal mirror is a defence notice of appearance dated June 10. Nearly three months after the remand motion, no ruling on it appears, and no judge has decided whether a state or a federal court hears the City's sweepstakes claims.

Kalshi is not waiting seven weeks. Kalshi Inc. and KalshiEX LLC removed their case to the US District Court for the District of Maryland on August 14, 2026, one day after filing, docket 1:26-cv-03217 before Judge James Kelleher Bredar, on diversity grounds. The notice was filed by William E. Havemann of Milbank LLP - the same lawyer who argued Kalshi's appeal against Maryland's own gambling regulator before the Fourth Circuit on May 7, 2026, in KalshiEX LLC v. Martin, No. 25-1892. That panel, Judges Roger L. Gregory, Stephanie D. Thacker and DeAndrea Gist Benjamin, has not ruled.

What is on appeal there is the ruling the City's own complaint recounts: on August 1, 2025 Judge Adam Abelson refused Kalshi a preliminary injunction against Maryland's regulator, finding Kalshi unlikely to succeed on its claim that federal law preempts state gaming law and holding that Maryland's sports-wagering laws and the Commodity Exchange Act operate "in tandem". So Baltimore filed its city case while the appeal that could decide whether Maryland can enforce its gambling law against Kalshi at all has been under submission for three months. Both sides are still feeding the panel new decisions: the most recent entries on the Fourth Circuit docket are supplemental-authority letters filed on August 10, 2026.

What should a Maryland player do now?

Nothing changes today. No court has ordered any platform to stop serving Maryland, and none of these filings affects a sweepstakes balance you already hold.

There is one thing worth doing, and it applies to the sweepstakes case rather than this one. Both of Baltimore's actions ask the court to order restitution to Baltimore consumers harmed by the practices alleged. If you live in Baltimore and have lost money at one of the seven brands named in the March suit, keep your purchase and redemption records. No court has awarded anything, no class has been certified and there is no claims process to sign up for, so treat this as record-keeping and nothing more. But the City is asking for money on behalf of people in exactly that position, and proof of what you spent is the part only you can produce.

What the filings should change is your read of the state. We reclassified Maryland from an open market to Restricted on August 5, 2026, and these two filings support that call rather than reopening it. Check our Maryland state page for which brands still accept registrations there, read how sweepstakes casinos are actually structured before assuming a "no purchase necessary" label settles the legal question, and compare states where the picture is cleaner in our best sweepstakes casinos ranking.

The wider pattern is one we have tracked all month: operators reorganising around a federal licence, and courts declining to treat that licence as a shield. A Washington judge rejected Kalshi's preemption defence outright on August 12, and the sector's own migration toward regulated derivatives shows up in Fliff and Onyx applying to become futures brokers.

Sources & documents

• City of Baltimore press release announcing both filings, August 13, 2026
• City of Baltimore v. KalshiEX LLC et al., complaint (PDF, 46 pages)
• City of Baltimore v. QCX LLC et al. (Polymarket), complaint (PDF, 27 pages)
• Federal docket, City of Baltimore v. KalshiEX LLC, D. Md. 1:26-cv-03217
• Federal dockets, City of Baltimore ex rel. Ebony Thompson v. QCX LLC, D. Md. 1:26-cv-03252 and 1:26-cv-03253, both dated August 17, 2026 and found on the August 18 re-read. On the August 19 re-read the second carries entry text - a notice of removal filed by QCX LLC at entry 1, the state-court complaint at entry 2 and a clerk's notice at entry 3 - and the first still carries no entries. The mirror holds no downloadable document on either, so nothing here describes the contents of any filing
• Federal docket, City of Baltimore v. VGW Malta Ltd et al., D. Md. 1:26-cv-01591
• Fourth Circuit docket, KalshiEX LLC v. Martin, No. 25-1892

Both complaints were downloaded and read in full on August 15, 2026 from plaintiffs' counsel's own posting of them, and the case numbers, e-filing timestamps and party lists above come from the face of those documents. The federal dockets were read on CourtListener's public RECAP mirror the same day; that mirror holds only what someone has pulled from PACER, so where this article says nothing later has been filed, it means nothing later appears in the mirror. Every characterisation of the defendants' conduct is an allegation by the City of Baltimore and has not been tested in court. In the two August cases we found no answer or other responsive pleading from any defendant; the only defence filings of any kind are the two notices of removal, Kalshi's on August 14 and QCX's on August 17. In the March sweepstakes case, defence counsel have entered appearances but no defendant has answered the complaint there either.

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