Buckeye Reporter

A coalition of 36 attorneys general, co-led by Ohio Attorney General Dave Yost, is challenging a federal court decision that could open a loophole for unregulated gambling. The group is urging the U.S. Court of Appeals for the Third Circuit to support New Jersey in its lawsuit against Kalshi, an online platform allowing users to bet on real-world events.

Yost emphasized the importance of state authority in regulating online gambling: “States rightfully have the ability to protect their citizens from the negative consequences of online gambling, no matter how it’s packaged,” he stated. “We’re protecting the unprotected.”

Kalshi argues that states lack regulatory power over its platform due to a provision in the Commodity Exchange Act that preempts state regulation when betting is conducted through events contracts. However, the attorneys general contend that federal law does not intend to remove state control over sports betting.

The amicus brief highlights potential risks if Kalshi's interpretation prevails, particularly concerning individuals struggling with gambling issues. “Eliminating the states’ ability to regulate online sports betting would pose very serious risks to the states’ citizens,” it warns. “Online sports betting, while convenient and entertaining for many, comes with life-altering consequences for some.”

The coalition is led by Yost and Nevada Attorney General Aaron Ford and includes representatives from Alabama, Arizona, Arkansas, Colorado, Connecticut, Delaware, District of Columbia, Hawaii, Idaho, Illinois, Indiana, Iowa, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Montana, New York, North Carolina, North Dakota, Northern Mariana Islands, Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Utah Vermont Washington and Wisconsin.

In previous efforts last month Yost led another amicus brief receiving bipartisan support nationwide. He has also served as president of the National Association of Attorneys General which fosters collaboration among states.