Robinhood has halted the issuance of new sports-event contracts in Michigan as it navigates an ongoing appeal in federal court. This decision, outlined in a stipulation dated September 4, 2026, comes as a result of a compromise established by a state court. Under the terms of this agreement, Robinhood Derivatives will refrain from offering new contracts to Michigan customers on platforms like KalshiEX and Rothera Exchange and Clearing until the appeal process is concluded.
In exchange for this pause, Michigan state officials have agreed not to initiate any legal actions against Robinhood. This temporary halt in operations allows for the continuation of a broader legal dispute surrounding the regulations of event contracts.
Robinhood filed a lawsuit against Michigan officials in federal court on March 4, 2026, arguing that the Commodity Exchange Act takes precedence over Michigan's gambling laws concerning event contracts traded on CFTC-approved exchanges. On June 17, a federal district court denied Robinhood's request for a preliminary injunction, prompting the company to file an appeal the following day. By June 23, the Sixth Circuit took up the case, which is noted as No. 26-1542, later merging it with a similar appeal involving Polymarket US.
Following the court's ruling, the Michigan Department of Attorney General directed Robinhood to cease trading sports contracts for customers in the state. In response, Robinhood asked for a grace period to help inform its customers and enable an orderly winding down of any existing positions.
