Kalshi Suits Using Arcane 1700s Law Are Lit Funder’s Big Bet

A litigation funder is driving lawsuits against prediction market platform Kalshi Inc. in six states, using an 18th century gambling law in a bid to claw back losses from predictions gone wrong.

Veridis Management LLC and its chief executive, Maximillian Amster, are behind entities that filed suits in Ohio, Kentucky, Illinois, South Carolina, Massachusetts and Georgia, court filings show. The suits reference state versions of the anti-illegal gambling Statute of Anne, which lets losing third parties sue winners for the values of losses plus fees.

“It’s a kind of genius,” said M. Todd Henderson, law professor at University of Chicago Law School. “Find people who lost bets and just step into their shoes.”

The suits represent a new avenue for litigation finance, an industry in which investors take something of a gamble themselves and pay for the cost of lawsuits with the hope that they gain a piece of any legal reward that results. The fast growing, though niche, industry has mainly funneled cash to more conventional areas of the law, such as intellectual property and product liability.

“Credit to the litigation finance people for finding this statute and realizing that they can, with technology, now reduce the cost of bringing these individual suits,” Henderson said.

The suits allege that closely-held Kalshi, which describes itself as an exchange that trades on the outcome of future events, is violating both state and federal law by allowing residents to place “illegal, unregulated wagers.” The suits list examples of Kalshi’s events, including the score of the NBA championship series and whether California Governor Gavin Newsom will be the Democratic nominee for president in 2028.

The goal is to “recover the ill-gotten gains” from “illegal, unregulated gambling offerings,” wrote attorneys from Kellogg, Hansen, Todd, Figel & Frederick for Ohio Gambling Recovery LLC in their complaint in the Ohio Court of Common Pleas.

The suits are also against Robinhood Markets Inc. and Webull Corp., which have partnered with Kalshi to offer its services on their platforms.

Kalshi and Webull declined to comment through their attorneys at Milbank. Robinhood’s attorneys did not respond to a request for comment.

Another LLC, DC Gambling Recovery, filed suit against DraftKings Inc. and other sports betting sites in February, also citing the Statute of Anne. The LLC has the same attorneys as those in the Kalshi suits.

Gaming Showdown

Kalshi operates what it calls a prediction market, which permits the buying and selling of “event contracts"—agreements, contracts, transactions or swaps in commodities that do not have intrinsic cash value and are not traded on a stock market. Kalshi was valued at $2 billion in June.

The US Commodity Futures Trading Commission granted Kalshi status as a designated contract market in 2020, which precludes it from regulation by state gambling regulators. But the contours of that status have been the subject of litigation and debate at state and federal levels.

For example, the CFTC limits event contracts that are “contrary to the public interest.” Last year, the CFTC tried to stop exchanges from listing election contracts, but Kalshi sued.

Last September, the US District Court for the District of Columbia weighed in, ruling that predicting the winner of a political election does not fall within the scope of “gaming,” as the term is defined in the Commodity Exchange Act.

In January, Kalshi began listing sports contracts. Ohio’s state gaming regulator in August sent Kalshi a cease-and-desist letter telling it to stop offering sports bets in Ohio, but Kalshi argues the letters are invalid because they are preempted by CFTC regulation.

Massachusetts attorney general sued the company in September to block it from operating its sports prediction platform in the state. On Sept. 30, senators from both parties called on the CFTC to rein in companies that offer sports betting as a type of event contract, according to a letter obtained by Bloomberg Law.

Veridis Role

The person behind the actions brought in the states is Amster, the CEO of Florida-based Veridis, according to a filing in the Ohio case by Kalshi and Webull. The address listed for the LLCs bringing the suits is the same as the address for Veridis.

Amster and Veridis did not respond to a request for comment.

Veridis specializes in complex litigation claims and other regulatory risk, according to its website. Its investments are generally non-recourse single case or portfolio financings in assets with $5 million or more in potential value. Its website lists a variety of causes of action it funds, including breach of contract, theft of trade secrets, and False Claims Act claims.

Before Amster founded Veridis, he served as a partner at private equity real estate partnership Avesta Development Group.

In January, Donald Trump Jr. joined Kalshi as a “strategic adviser.”

“On Election night at Mar-a-Lago, while biased outlets called the race a coin toss, my family and close friends used the prediction market Kalshi to know we won hours ahead of the fake news media,” Trump Jr. said in a statement posted on X in January.

President Donald Trump’s nominee to run the CFTC, Brian Quintenz, was previously a member of Kalshi’s board of directors. Bloomberg News reported that the White House is pulling his nomination after weeks of speculation about his stalled candidacy.

The cases are:

Ohio Gambling Recovery LLC v. Kalshi, Inc., N.D. Ohio, 25-cv-01573-BYP, 7/28/25

Massachusetts Gambling Recovery LLC v. Kalshi INc., D. Mass., 25-cv-12707, 9/22/25

Illinois Gambling Recovery LLC v. Kalshi Inc., N.D. Ill., 25-cv-11374, 9/19/25

DC Gambling Recovery LLC v. American Wagering, Inc., D.D.C., 25-cv-01023-CJN, 4/4/25