New York sued the company behind Polymarket US, QCX LLC, alleging in a Thursday press release that the prediction market platform runs an illegal gambling operation.
The lawsuit alleges that Polymarket’s prediction markets meet the legal definition of gambling and that the company has failed to obtain a license from the New York State Gaming Commission, according to the release.
It seeks a court order stopping Polymarket from operating as an unlicensed gambling business in the state and requiring the company to pay fines and restitution, per the release.
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New York Attorney General Letitia James said in the release: “By skirting New York’s laws, Polymarket is targeting the most vulnerable and depriving New York families of critical services and support.”
New York Governor Kathy Hochul said in the release: “By running an unlicensed gambling operation, Polymarket has done more than just knowingly violate state law, they have put New Yorkers at risk, especially those underage who are most vulnerable to problem gaming.”
Reached by PYMNTS, Polymarket provided a statement in which the company’s chief legal officer, Neal Kumar, said the company will fight for its users.
“While the AG’s decision to copy/paste a recycled lawsuit is disappointing, we’ll fight for our users,” Kumar said. “We didn’t run to preemptively sue the state — we chose to engage with them directly on the substance and address their concerns. They preferred the media hit. Any time the AG’s office wants to swing by, our door is open for a conversation about how we protect consumers and offer fair, transparent and legal markets.”
New York sued Coinbase and Gemini Titan in April, alleging that the companies’ prediction market platforms are illegal, unlicensed gambling operations.
Days later, the Commodity Futures Trading Commission(CFTC) announced that it had filed suit against New York in response to what the regulator said was the state’s effort to apply its gambling laws to CFTC-regulated contract markets. The CFTC said that with its suit, it was seeking a declaratory judgment that federal law allows it exclusive authority to regulate event contracts.
In August, New York sued prediction market platform Kalshi, alleging the company is operating an unlicensed gambling operation in violation of state law.
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