Crypto.com, Novig sue Missouri over sports event contracts; Kalshi, Polymarket, Robinhood hold off

Crypto.com's prediction market exchange and Novig sued Missouri officials in federal court on Friday, asking judges to bar the state from enforcing its sports wagering laws against their event contracts as cease-and-desist deadlines set by Attorney General Catherine Hanaway ran out.Kalshi, Polymarket, Robinhood and Underdog received the same letters in September. None of the four had filed suit in Missouri's Eastern or Western federal districts as of Sunday, according to a review of court records by The Block. The four firms did not immediately respond to a request for comment from The Block.Hanaway sent the letters on Sept. 16 and 17, giving each operator 30 days to stop offering sports event contracts to Missourians or get a license from the Missouri Gaming Commission, which has overseen legal sports wagering since voters approved it in November 2024, and pay the state's 10% wagering tax. Her letter to Crypto.com also said the platform lets users as young as 18 trade, while Missouri’s minimum age for sports betting is 21."Companies cannot repackage sports bets as 'event contracts' to evade Missouri law," Hanaway said on X.North American Derivatives Exchange, the CFTC-registered exchange behind Crypto.com's OG prediction markets platform, filed its lawsuit in the Western District of Missouri. The suit argues that the Commodity Exchange Act gives the CFTC "exclusive jurisdiction" over its contracts and preempts state gambling law, and it seeks a declaratory judgment and a permanent injunction.The complaint says Hanaway "incorrectly addressed" her letter to Foris DAX, Inc. instead of the exchange. It also says obtaining a sports betting license is not an option, since Missouri's constitution allows only two direct mobile sports wagering licenses and both have been awarded.Novig, which has sued officials in several other states including Wisconsin, filed its lawsuit in Missouri's Eastern District through its exchange operator, Ludlow Exchange LLC. Novig's suit asks for a preliminary and permanent injunction.The prediction market, known for its partnership with the New York Mets and its viral advertisement featuring actress Sydney Sweeney, argues the court should grant a preliminary injunction to preserve the status quo while the 8th Circuit, which covers Missouri, hears an appeal on the same question in a Kalshi case from Iowa.Other federal appeals courts have split on the question of whether federal law preempts state gambling laws for sports event contracts, with the 6th and 9th Circuits ruling against Kalshi and the 3rd Circuit siding with it.Kalshi was the first of the six companies to respond to Hanaway's letters, and the attorney general's office described "ongoing discussions" with the company, Spectrum News reported on Oct. 2. Underdog sued Connecticut last month over a similar crackdown but has not taken Missouri to court.Crypto.com, Novig and the Missouri attorney general’s office also did not immediately respond to requests for comment.