Polymarket US sues Ohio over cease-and-desist order after state moved to block sports event contracts

Polymarket US has taken Ohio to federal court over a cease-and-desist order tied to its sports event contracts. The core issue for high-risk operators is the usual one: whether state gambling rules can be used to box in a federally regulated market.

1. QCX LLC, which operates as Polymarket US, filed the complaint on October 16 in the US District Court for the Southern District of Ohio. The filing came the same day the Ohio Casino Control Commission had set as the deadline for the company to confirm it had stopped offering sports event contracts in the state.
2. The case, No. 2:26-cv-01502, names Attorney General Andy Wilson, interim executive director Andromeda Morrison and the commission’s seven members in their official capacities. Judge Douglas R. Cole has been assigned to the case. Polymarket US is represented by Squire Patton Boggs and Gibson, Dunn & Crutcher.
3. The complaint follows cease-and-desist letters sent by the commission on October 2 to Polymarket and nine other prediction market platforms and brokers. The regulator ordered the company to “immediately cease and desist from offering sports event contracts to Ohio residents without a licence issued by the Commission” and to confirm compliance within 14 days.
4. Polymarket argues Ohio’s licensing rules unlawfully favour businesses with a local presence. Under state law, online sports betting licences are generally limited to applicants that have an operating business or a sports gaming facility in Ohio. The company says major brands such as FanDuel, DraftKings, BetMGM, Caesars, bet365, Fanatics and ESPN Bet can operate in Ohio through agreements with locally licensed businesses.
5. The lawsuit also targets rules requiring betting servers to be located in secure facilities in Ohio and limiting wagers to people physically present in the state. Polymarket says these requirements violate the Constitution’s interstate commerce protections. On the federal side, it argues that the Commodity Exchange Act overrides Ohio’s gambling laws as applied to Polymarket, since the CFTC designated it a contract market on July 9, 2025.

For PSPs, acquiring banks and platforms in high-risk verticals, this is the part that matters: the complaint is not just about one operator’s access to one state. It is also a test of how far a state can go in imposing local licensing, server-location and in-state wagering requirements when a federal commodities regime is in play.