FlightAware Drops Kalshi Lawsuit One Day After Filing

Just a day after real-time flight tracking website FlightAware filed a lawsuit against prediction markets platform Kalshi over use of its name and data, the flight data company gave notice of voluntary dismissal of the case. 

In a Tuesday filing in the US District Court for the Southern District of New York, attorneys for FlightAware said that they had voluntarily dismissed the case against Kalshi. The flight tracking company had filed the lawsuit a day earlier, claiming that Kalshi had used its “data and name to run gambling markets on flight cancellations.”

While the immediate turnaround could suggest a closed-door settlement, neither company had publicly commented on the case as of Wednesday. On Tuesday, a judge ordered Kalshi to show cause why the court should not issue a temporary restraining order over FlightAware’s trademark and data. 

Notably, at least one event contract showed that Kalshi had changed its language from “FlightAware“ to “Primary Source Agency” as the entity responsible for verifying data related to the outcome of flight cancellations, including that the trade did not “indicate an endorsement of this product or any affiliation” between FlightAware and Kalshi. Primary Source Agency linked to FlightAware’s website. Cointelegraph reached out to the companies for comment but did not receive an immediate response.

Side-by-side comparison of event contract citing FlightAware data before the lawsuit was dropped (left) and after (right). Source: Kalshi

Related: Kalshi launches sports and crypto perps data feed on DoubleZero

FlightAware’s suit had alleged trademark infringement, breach of contract, injury to its reputation and unfair competition in the latest legal action involving prediction market companies. Kalshi, Polymarket and other prediction market companies face legal action brought by many US state gaming authorities and regulators over alleged illicit sports betting offered to residents.

CFTC still at odds with state authorities over prediction markets

On Tuesday, the US Commodity Futures Trading Commission (CFTC), whose chair Michael Selig has repeatedly claimed the agency has “exclusive jurisdiction“ over prediction markets, said it had invoked “emergency authority“ to block New York state officials’ attempts to seek a temporary restraining order prohibiting the company from offering event contracts nationwide. The action followed New York authorities filing a lawsuit against Kalshi in July, alleging that the company was operating an unlicensed gambling platform through its contracts on sports and other events.

The CFTC decision echoed the agency’s actions in a Michigan case over Kalshi. In June, a Michigan judge ordered the company to stop offering sports betting contracts to residents until the civil case reached a conclusion. However, the CFTC under Selig ordered Kalshi not to comply with the state order — something the company’s head of enforcement and legal counsel said put it in an “impossible position“ between US state and federal orders.

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