FlightAware has dropped its lawsuit against prediction market operator Kalshi just one day after filing the case, bringing an unusually fast end to a dispute over the use of flight-tracking data and trademarks in cancellation prediction markets.
According to a filing submitted Tuesday in the U.S. District Court, FlightAware voluntarily dismissed the lawsuit it had filed against Kalshi a day earlier.
The company had accused Kalshi of improperly using FlightAware’s data and branding to settle markets based on whether particular flights would be canceled.
FlightAware had also asked the court for a temporary restraining order that could have stopped Kalshi from using its information while the legal dispute was being resolved.
That request became unnecessary once the lawsuit was withdrawn.
FlightAware did not publicly explain why it dismissed the case so quickly, leaving open the possibility that the companies may have reached some form of private understanding.
FlightAware lawsuit lasted only one day
The lawsuit was originally filed Monday and focused on Kalshi’s flight cancellation prediction markets.
Kalshi allows users to trade contracts based on the outcome of real-world events, including whether individual flights will be delayed or canceled.
FlightAware objected to how the platform referenced its data.
Kalshi had previously told users that certain flight market outcomes were “verified from FlightAware.”
That language directly connected FlightAware’s brand with Kalshi’s prediction products.
FlightAware argued that Kalshi was using its trademark and flight information without proper authorization.
The company also described the products in its complaint as gambling markets connected to flight cancellations.
Because of those concerns, FlightAware sought emergency court intervention through a temporary restraining order.
However, the legal battle ended almost immediately after the company voluntarily dismissed the case.
Rapid dismissal may point to a private agreement
Neither company has announced a settlement.
However, the speed of the dismissal has attracted attention from legal observers.
Corporate attorney and Givner Law founder Ariel Givner suggested that withdrawing a lawsuit shortly after requesting emergency relief can sometimes indicate that the parties resolved the dispute privately.
A plaintiff seeking a temporary restraining order usually believes the issue requires immediate court action.
Dropping the case the following day can therefore suggest that something changed quickly outside the courtroom.
Still, there is currently no public confirmation that FlightAware and Kalshi reached a settlement or entered into another agreement.
The court filing simply confirms that FlightAware voluntarily dismissed its lawsuit.
Kalshi changes wording on flight cancellation markets
Following the dispute, Kalshi changed how it describes the information used to settle some flight-related prediction contracts.
Instead of stating that the outcome is “verified from FlightAware,” the platform now says it is “verified from Primary Source Agency.”
The page still directs users to FlightAware’s website, but the company is no longer identified by name in the main verification statement.
Kalshi has also added language making clear that the source used to verify a market outcome does not necessarily support or participate in the product.
The platform says the relevant agency and its affiliates have not endorsed the prediction market.
It also explains that references to delay or cancellation information are descriptive and should not be interpreted as evidence of a commercial relationship.
The wording appears to address one of the central issues raised by FlightAware.
However, neither the language change nor the lawsuit’s dismissal confirms whether the two companies reached an agreement.
Flight cancellation markets are only one part of Kalshi’s business
The FlightAware dispute involved a relatively small part of Kalshi’s broader prediction market platform.
Kalshi offers contracts based on a wide range of real-world events.
Users can trade positions based on economic data, politics, financial markets, sports and other outcomes.
Flight cancellation markets operate in a similar way.
Traders can take positions based on whether a particular flight will be canceled, with the contract settled using an external source of flight information.
The legal dispute focused primarily on how Kalshi identified that external source rather than on the basic structure of the prediction market itself.
That makes the FlightAware lawsuit different from many of the other legal challenges currently facing the company.
Kalshi remains involved in major regulatory battles
Although the FlightAware dispute ended quickly, Kalshi is still involved in several much larger court cases concerning the legal status of prediction markets.
A major question is whether sports-related prediction contracts should be regulated under state gambling laws or federal commodities regulations.
Kalshi argues that its status as a Commodity Futures Trading Commission-regulated designated contract market places its event contracts under federal jurisdiction.
Several states disagree.
They argue that contracts tied to sporting events can function like sports betting and should therefore comply with state gaming laws.
That disagreement has produced lawsuits in multiple jurisdictions.
Kalshi faced setback in New York
In July, Kalshi suffered a setback in its legal dispute with New York.
A federal judge rejected the company’s request for a preliminary injunction that would have restricted the state’s ability to challenge its sports-related event contracts.
U.S. District Judge Analisa Torres concluded that Kalshi had not yet demonstrated that federal commodities law was likely to override New York’s gambling regulations.
That decision did not resolve the entire case.
Instead, it allowed the state’s challenge to continue to the motion-to-dismiss stage.
The case remains important because its outcome could influence how prediction markets offering sports-linked contracts operate across the United States.
Michigan also challenged Kalshi’s sports markets
Kalshi has faced similar resistance in Michigan.
In June, an Ingham County Circuit Court judge temporarily prohibited the company from offering sports event contracts to Michigan residents.
The order lasted 14 days and required Kalshi to use geolocation controls to prevent affected users from accessing the products.
Potential penalties were set at $120,000 for each day of noncompliance.
Cases such as these show how difficult the regulatory environment has become for prediction market operators.
Federal and state authorities are not always taking the same position on whether event contracts should be treated as financial derivatives or gambling products.
CFTC has stepped into state disputes
The disagreement has also drawn the CFTC directly into the legal battle.
In June, Kentucky Attorney General Russell Coleman sued Kalshi, Polymarket and several related companies, alleging they were offering unlicensed sports betting products.
The Kalshi-related complaint also named companies including Coinbase, Robinhood and Webull because they provided users with access to sports event contracts.
Only days later, the CFTC filed its own federal lawsuit against Kentucky.
The agency sought to prevent the state from applying gaming laws to prediction market operators that trade federally regulated event contracts.
The CFTC argued that these products fall under the Commodity Exchange Act and therefore sit within federal commodities jurisdiction.
That intervention highlights the growing conflict between state gambling regulators and federal derivatives authorities.
Kalshi won an important New Jersey case
Kalshi has not lost every major legal battle.
In April, the U.S. Court of Appeals for the Third Circuit sided with the company in its dispute with New Jersey.
In a 2-1 ruling, the court found that New Jersey could not regulate Kalshi’s CFTC-supervised sports event contracts under state gambling rules.
The ruling concluded that the Commodity Exchange Act gave federal authorities jurisdiction over those products.
That decision strengthened Kalshi’s argument that federally regulated prediction markets should not have to comply with separate state gambling frameworks.
However, because other courts and states continue to take different approaches, the overall legal question remains unsettled.
Kalshi has also challenged Minnesota restrictions
Kalshi has increasingly gone on the offensive against state-level restrictions.
In May, the company sued Minnesota officials over a law scheduled to take effect Aug. 1.
The law would make operating certain prediction markets in the state a felony.
Kalshi argued that Minnesota does not have authority to regulate its federally supervised event contracts.
Once again, the company’s core argument was that the Commodity Exchange Act gives the CFTC exclusive jurisdiction over its markets.
The growing number of lawsuits means the future of prediction markets in the United States may depend heavily on how federal courts define the boundary between derivatives and gambling.
Prediction market activity remains strong
Despite the legal uncertainty, trading activity across prediction markets has continued to grow.
Data cited in June showed Kalshi recording approximately $3.7 billion in weekly trading volume, compared with around $3.2 billion for Polymarket.
Sports-related markets represented the largest category on both platforms.
Kalshi was processing about $328 million in daily sports trading volume at the time.
The company has also expanded beyond traditional event contracts.
In June, Kalshi added perpetual futures tied to cryptocurrencies including Zcash and Near Protocol.
That brought its CFTC-regulated crypto perpetual offering to 13 assets at the time.
The expansion shows that Kalshi is developing into a broader financial trading platform even as its event contracts continue to face regulatory challenges.
FlightAware dispute appears resolved for now
Compared with Kalshi’s major disputes with state governments, the FlightAware lawsuit was unusually short-lived.
The case focused on whether Kalshi could use FlightAware’s data and trademark in connection with flight cancellation prediction markets.
Kalshi has since changed the relevant wording on its platform.
The company no longer directly names FlightAware in the verification statement and instead refers to a “Primary Source Agency.”
It has also added disclaimers stating that the information source does not endorse or have an affiliation with the prediction market.
Those changes appear to address at least some of FlightAware’s concerns.
But because neither company has disclosed whether they reached a settlement, the exact reason for the sudden dismissal remains unknown.
For now, the lawsuit is over, while Kalshi’s much larger fight over how prediction markets should be regulated in the United States continues.
