Polymarket and Robinhood sue Missouri over sports event contracts

Polymarket and Robinhood have taken Missouri to federal court after state officials moved to stop them from offering sports event contracts. For high-risk operators, the point is not just the headline dispute: Missouri is trying to push prediction markets into its sports betting regime, while the companies are arguing that federal law leaves the state with limited room to do that.

1. Polymarket US and Robinhood filed separate federal lawsuits against Missouri officials after cease-and-desist letters sent in September 2026 by Attorney General Catherine Hanaway to Novig, Polymarket US, Robinhood, Kalshi, Underdog and Crypto.com. The letters demanded that the companies immediately stop offering sports-related contracts in Missouri.
2. Hanaway’s position is that the contracts amount to unlicensed sports wagering under Missouri law, based on the sports betting framework launched in December 2025. Missouri’s current system requires licensed online sportsbooks to limit operations geographically to the state and to keep data centres and corporate infrastructure inside Missouri, which is exactly the sort of local-operating rule that becomes a problem when the product is sold across state lines.
3. Polymarket US argues that Missouri’s licensing requirements for sports betting operators violate the Commerce Clause of the US Constitution because they restrict interstate commerce. It also challenges a Gaming Commission rule that requires licensed operators to keep their servers physically within Missouri, and asks the court for preliminary and permanent injunctions.
4. The Polymarket complaint also cites the Commodity Futures Trading Commission’s (CFTC) November 5 impartial access interpretation, saying that geographic restrictions introduced to comply with state gambling laws are incompatible with exchange regulations. In other words, Polymarket is framing the issue as a federal market-access question, not a state gaming licence question.
5. Robinhood’s lawsuit takes a different route: it argues that sports event contracts are financial products authorised at the federal level and therefore fall under the CFTC’s jurisdiction rather than Missouri’s gambling laws. Same product category, different legal theory, which is usually what you see when operators are trying to keep multiple paths open in federal court.

For PSPs, acquirers and banks, the practical issue is jurisdictional. Missouri is treating sports event contracts like local wagering, with state-specific infrastructure and licensing expectations; Polymarket and Robinhood are saying federal law governs the product and limits what the state can force them to do.