Man who lost $308,000 on sports bets sues Kalshi for offering illegal gambling

“The contracts which Plaintiff mischaracterizes as gambling are event contracts offered on the Platform subject to the CEA [Commodity Exchange Act], in conformance with the rules and regulations of the CFTC [Commodity Futures Trading Commission], the federal agency which has statutory authority to oversee the CEA,” Kalshi said.

We contacted Bright’s attorney, Michael Daudt, about Kalshi’s court filings and will update this article if we get a response.

“Plaintiff alleges that his activity on the platform was gambling and that he ‘lost,’” Kalshi wrote. “He does not allege that anyone misled him about how the platform worked, what it charged, or the risk that any position might lose. Yet, he now sues KalshiEX and its parent, Kalshi Inc., to recover nearly double his own alleged net realized loss under Washington’s gambling loss-recovery statute, and a theory of unjust enrichment.”

Between June 17 and August 14, 2026, Bright transferred $315,353.94 to Kalshi in 253 separate debits from his checking account, his lawsuit said. Kalshi allegedly collected $5,589.05 in funding fees on those transfers.

Bright made numerous wagers on sporting events including professional baseball games and tennis matches. He apparently put any winnings into new bets, and alleges that “Kalshi’s platform cycled Plaintiff’s deposits through $14,396,457.30 in transactions and assessed and retained $84,062.71 in trading fees on them, equal to 26.7 percent of everything Plaintiff deposited.”

After all his bets, Bright suffered a net loss of $308,781.62, and his account was left with a balance of $983.27. Kalshi said that Bright’s “alleged losses went to counterparties rather than” to Kalshi itself and that Bright’s “positions were matched with counterparties and resolved according to the outcomes of the underlying events.”

“The Complaint does not allege that KalshiEX or Kalshi Inc. was the counterparty to any of Plaintiff’s positions,” Kalshi said.

Kalshi calls itself “a neutral exchange platform” with no financial stake in the outcome of any event. It makes revenue by collecting fees on transactions. But while Kalshi describes itself as a neutral operator and collector of transaction fees, its business model also includes a trading affiliate that places wagers on the platform.