Underdog PredictLegal
Where are Underdog Predict’s event contracts available? 4 states with a case, tracked
Last checked against court dockets and filings · Updated
As of Oct 28, 2026, no order we found has switched off any Underdog Predict event contracts and in 4 states a lawsuit or regulator’s action is live with nothing switched off. Each is checked against its docket and filings. States that have acted say their gambling law applies, and UDM, LLC is a futures commission merchant registered with the CFTC: a licensing dispute, not a tax ruling, and with no IRS guidance people file event contracts three common ways.
By Owen Monagan, Founder & CEOUpdated
Underdog Predict by state
Checked Oct 28, 2026- Switched off
- 0
- Ordered, on hold
- 0
- Case pending
- 4
- No action found
- 47
- Switched off
Map
Every state, dated.
Every state sits in one of four groups. Select a state for where it stands and the filing behind it.
Underdog Predict’s event contracts are offered by UDM, LLC, a futures commission merchant registered with the CFTC. It is not the exchange: the contracts are listed on Underdog Exchange (Aristotle Exchange DCM, Inc.), Kalshi (KalshiEX LLC) and Crypto.com | Derivatives North America (North American Derivatives Exchange, Inc.).
Underdog Predict, state by state
As of Oct 28, 2026Connecticut
Case pendingIn September 2026 Connecticut named Underdog Predict among nine prediction markets it ordered to stop offering sports contracts to residents. We have not seen the order itself.
- Switched off
- 0
- A court order, or an agreement a court has entered as an order, is in force under which Underdog Predict does not offer the covered markets in the state.
- Ordered, on hold
- 0
- The order is paused while the appeal is heard.
- Case pending
- 4
- A lawsuit or regulator's cease-and-desist is live. We found no court order or agreement in force that stops Underdog Predict offering contracts.
- No action found
- 47
- We found no order, lawsuit or cease-and-desist naming Underdog here.
Event contracts offered through Underdog Predict, state by state. UDM, LLC, which does business as Underdog Predict, says in its federal court filings that it is a futures commission merchant registered with the CFTC and the NFA. Underdog's Predict page says its event contracts are offered by exchanges including its own Underdog Exchange, Kalshi and Crypto.com | Derivatives North America. Underdog Exchange is Aristotle Exchange DCM, Inc., which the CFTC designated a contract market on September 5, 2025 and which Underdog says it acquired in March 2026. Each action below says which Underdog company it names. What a court or regulator has actually done, as it stands on the date above. Tiles are equal in size so a small state reads as clearly as a large one. The state list below holds the same data as text.
What changedSince Oct 28, 2026
Underdog Predict cases: what changed since Oct 28, 2026?
No change for Underdog Predict since Oct 13, 2026. The last one is below. Last checked Oct 28, 2026.
- Nothing changes for accounts yetUnderdog's exchange and its futures commission merchant sued Tennessee officials in federal court, asking the court to bar them from enforcing state gambling laws against Underdog. Filing
Lawsuits3 actions
What states have sued Underdog Predict?
As of Oct 28, 2026, no states have taken Underdog Predict to court. Two other things also get called suing Underdog Predict, and only an order in force switches anything off.
- 01A state or city suesAn attorney general, a gaming regulator or a city goes to court. Only an order in force switches anything off.
- 02Underdog Predict sues the state firstUnderdog Predict asks a federal court to stop a state’s officials enforcing state gambling law against it.
- 03A regulator acts on its ownA cease-and-desist letter or order, or a proposed fine. None of these switches anything off by itself.
| Date | State | Action | Status now | Filing |
|---|---|---|---|---|
| Sep 2026 | Connecticut | Cease-and-desist. Connecticut Department of Consumer Protection: One of nine cease-and-desist orders to prediction markets announced by the governor's office, which lists Underdog Predict. | Case pending | Filing |
| Sep 17, 2026 | Missouri | Cease-and-desist. Missouri Attorney General: Cease-and-desist letter to Underdog Sports Wagering, LLC asking it to stop offering sports wagering in Missouri or obtain a state license. | Case pending | Filing |
| Oct 9, 2026 | Tennessee | Cease-and-desist. Tennessee Sports Wagering Council: Cease-and-desist letter to Underdog, as Underdog's federal complaint describes it, demanding that it stop offering sports event contracts to customers in Tennessee. | Case pending | Filing |
Where Underdog Predict went to court first
| State | Case | Docket |
|---|---|---|
| Massachusetts | Suit by Underdog's exchange and its futures commission merchant against Massachusetts's attorney general and Gaming Commission officials, asking the court to bar them from enforcing state gambling laws against UnderdogU.S. District Court, D. Mass., No. 1:26-cv-14098 | Docket |
| Tennessee | Suit by Underdog's exchange and its futures commission merchant against Tennessee's attorney general and Sports Wagering Council officials, asking the court to bar them from enforcing state gambling laws against UnderdogU.S. District Court, M.D. Tenn., No. 3:26-cv-01461 | Docket |
Whether federal commodities law preempts state gambling law is being argued in suits by venues, states and the CFTC. Prediction market legal status by state sets every venue’s cases side by side.
Your money
What these orders mean for your account.
An order stops new trades in the markets it covers. Where an order or agreement also sets terms for open positions or cash, the state’s row quotes it.
Wherever you are
- UDM, LLC, which does business as Underdog Predict, says in its federal court filings that it is a futures commission merchant regulated by the NFA and the CFTC, and that it registered with both on January 9, 2026. Source
- The CFTC designated Aristotle Exchange DCM, Inc. a contract market on September 5, 2025, and the CFTC's filings page lists its status as designated. Underdog says it acquired that company in March 2026. Source
Courts
Where the courts stand on Underdog Predict.
Whether federal commodities law preempts state gambling law is unresolved. Each federal appeals court with a Underdog Predict case, and the Supreme Court dates ahead.
| Court | Ruling | Where it stands | Source |
|---|---|---|---|
| Third CircuitDE, NJ, PA | For Underdog Predict | Ruled for Kalshi: it is likely to succeed in showing that federal law preempts New Jersey's ban on its sports contracts. (Apr 6, 2026) | Opinion |
| Ninth CircuitAK, AZ, CA, HI, ID, MT, NV, OR, WA | For the states | Ruled for Nevada: sports contracts likely aren't swaps, so states can enforce. Kalshi has asked the full court to rehear the case. (Aug 28, 2026) | Opinion |
| Fourth CircuitMD, NC, SC, VA, WV | No decision yet | Heard Maryland's case May 7, 2026. No decision yet. | Docket |
| Sixth CircuitKY, MI, OH, TN | For the states | Ruled for Ohio and Tennessee: Kalshi hasn't shown its sports contracts are swaps, and even if they were, federal commodities law doesn't preempt the states' gambling laws. Kalshi asked the full court to rehear on Oct 9, 2026. (Sep 25, 2026) | Opinion |
| Tenth CircuitCO, KS, NM, OK, UT, WY | No decision yet | Refused on Sep 8, 2026 to pause Utah's win while Kalshi appeals. The appeal itself is pending. | Docket |
| Second CircuitCT, NY, VT | No decision yet | Hearing Kalshi's appeals from New York (No. 26-1835) and Connecticut (No. 26-2239) in tandem. New York's brief is due Oct 30, 2026. | Docket |
| Seventh CircuitIL, IN, WI | No decision yet | No ruling on Kalshi yet. Appeals from the CFTC's suit against Wisconsin were docketed in August 2026. | Docket |
| Eighth CircuitAR, IA, MN, MO, NE, ND, SD | No decision yet | Kalshi appealed Iowa's win on Sep 15, 2026 (No. 26-2874). No decision yet. | Docket |
Underdog Predict at the Supreme Court
Who gets to regulate sports contracts on a federally registered exchange: only the federal regulator, or the states too? The Court is being asked whether federal commodities law preempts state gambling laws, not whether anyone must stop, and not how the trades are taxed.
- No. 26-299Filed Sep 2, 2026Flaherty v. KalshiEXNew Jersey (state gaming regulators). From the Third Circuit, No. 25-1922, which ruled for Kalshi on Apr 6, 2026.Kalshi's response is due Nov 9, 2026, extended at Kalshi's request from Oct 8. Briefs backing New Jersey's side have come from Ohio, 38 other states and the District of Columbia (Oct 7), and more amicus briefs followed on Oct 8, including from the NFL, the American Gaming Association and 145 tribes.Docket
- No. 26-338Filed Sep 10, 2026Robinhood Derivatives v. DreitzerRobinhood (a broker offering Kalshi's contracts). From the Ninth Circuit, No. 25-7831, which ruled for Nevada on Aug 28, 2026.Nevada's response is due Nov 13, 2026, extended from Oct 14.Docket
- No. 26-344Filed Sep 11, 2026North American Derivatives Exchange v. NevadaCrypto.com (another exchange). From the Ninth Circuit, No. 25-7187, which ruled for Nevada on Aug 28, 2026.Nevada's response is due Nov 16, 2026, extended at Nevada's request from Oct 15.Docket
Underdog Predict case dates ahead
Why there is more than one way to file
Federal appeals courts are split over whether these contracts are gambling that a state can license or exchange products that only the CFTC regulates. A ruling on state licensing is not a tax ruling, and the IRS has issued no guidance on event contracts. Because no court or agency has settled what these contracts are, people file them more than one way. Of the people we’ve seen file, these are the three most common ways, and Realize supports each of them. The same trades can be priced under each route, side by side.
| Route | Form | What it does |
|---|---|---|
| Gambling income, section 165(d) | Schedule 1; losses on Schedule A | Winnings are reported in full. Losses can be deducted only if you itemize, at 90% of losses and capped at winnings (tax years beginning after Dec 31, 2025). |
| Standard capital gains | Form 8949 and Schedule D | Each closed contract is a sale. Gain or loss is short or long term by holding period, and net losses can offset other gains. |
| Section 1256 | Form 6781 | 60% of the net gain or loss is treated as long term and 40% as short term. Open positions are marked to market at year end, and a net loss can be carried back three years. |
How prediction market trades are taxedPrediction-market lawsuits, state by state
Realize’s Supreme Court tracker follows the petitions asking whether federal commodities law preempts state gambling law.
State by state4 states with a case
Every state with a Underdog Predict case.
Each state with a case, in its group as of Oct 28, 2026. Every filing behind them is in the sources below.
| State | Group | Where it stands |
|---|---|---|
| Connecticut | Case pending | In September 2026 Connecticut named Underdog Predict among nine prediction markets it ordered to stop offering sports contracts to residents. We have not seen the order itself. |
| Massachusetts | Case pending | Underdog sued Massachusetts officials in federal court on September 8, 2026, asking the court to bar them from applying state gambling laws to its event contracts. We found no Massachusetts order against Underdog. |
| Missouri | Case pending | Missouri's attorney general sent Underdog a cease-and-desist letter in September 2026, addressed to Underdog Sports Wagering, LLC. A letter is not a court order. |
| Tennessee | Case pending | Underdog says Tennessee's Sports Wagering Council sent it a cease-and-desist letter on October 9, 2026, and Underdog sued Tennessee officials in federal court on October 13. We found no court order in the case. |
Questions4 questions
Questions people ask about Underdog Predict’s legal status.
Short answers, from the status file as of Oct 28, 2026.
Is Underdog Predict legal in my state?
As of Oct 28, 2026, Underdog Predict faces a lawsuit, order or cease-and-desist in 4 states. In the other 4 states with a case, nothing is switched off, and in every state not listed we found no order, lawsuit or cease-and-desist.
Which states have sued Underdog Predict?
As of Oct 28, 2026, no state has sued Underdog Predict; every action against it is listed by state above.
Has the Supreme Court taken a Underdog Predict case?
Not as of Oct 28, 2026. Three petitions ask it whether federal commodities law preempts state gambling law, and none has been granted. The next date on the docket is Nov 9, 2026: Kalshi's response to New Jersey's petition is due.
How current is this page?
We check Underdog Predict’s cases against court dockets and filings, and the last check was Oct 28, 2026. Changes since Oct 28, 2026 are listed newest first, each with the filing it comes from, so you can read the docket yourself.
Sources17 documents
Where each status comes from.
Primary documents first, each with the date we last read it. Where we keep a copy of a filing, it is linked beside the original.
- Complaint, Underdog Exchange DCM, Inc. v. Campbell (D. Mass.), ECF 1 U.S. District Court, D. Mass. (filed by Underdog Exchange DCM, Inc. and UDM, LLC) · Checked October 28, 2026Our copy
- Connecticut governor's office release, “Governor Lamont announces new actions against illegal prediction markets offering sports wagers in Connecticut” Connecticut Governor · Checked October 28, 2026
- Missouri Attorney General's cease-and-desist letter to Underdog Sports Wagering, LLC (“Underdog”) Missouri Attorney General · Checked October 28, 2026Our copy
- Missouri Attorney General release, “Hanaway orders unlicensed prediction markets to cease and desist unlawful sports wagering” Missouri Attorney General · Checked October 28, 2026
- Complaint, Underdog Exchange DCM, Inc. v. Skrmetti (M.D. Tenn.), ECF 1 U.S. District Court, M.D. Tenn. (filed by Underdog Exchange DCM, Inc. and UDM, LLC) · Checked October 28, 2026Our copy
- CFTC, Order of Designation: In the Matter of the Application of Aristotle Exchange DCM, Inc. for Designation as a Contract Market Commodity Futures Trading Commission · Checked October 28, 2026Our copy
- KalshiEX v. Flaherty, precedential opinion U.S. Court of Appeals for the Third Circuit · Checked October 8, 2026Our copy
- KalshiEX v. Assad, Ninth Circuit opinion U.S. Court of Appeals for the Ninth Circuit · Checked October 8, 2026Our copy
Show all 17 documentsShow fewer
- KalshiEX v. Martin, docket U.S. Court of Appeals for the Fourth Circuit · Checked October 8, 2026
- KalshiEX v. Schuler, opinion (Ohio and Tennessee) U.S. Court of Appeals for the Sixth Circuit · Checked October 12, 2026Our copy
- KalshiEX v. Cox, docket U.S. Court of Appeals for the Tenth Circuit · Checked October 8, 2026
- KalshiEX v. Williams, docket U.S. Court of Appeals for the Second Circuit · Checked October 8, 2026
- United States v. State of Wisconsin, docket U.S. District Court for the Eastern District of Wisconsin · Checked October 22, 2026
- KalshiEX v. Bird, docket U.S. District Court for the Southern District of Iowa · Checked October 8, 2026
- Supreme Court docket, No. 26-299 Supreme Court of the United States · Checked October 12, 2026
- Supreme Court docket, No. 26-338 Supreme Court of the United States · Checked October 12, 2026
- Supreme Court docket, No. 26-344 Supreme Court of the United States · Checked October 12, 2026
Also on Realize
At tax time.
An order changes where Underdog Predict offers a market.
Price your Underdog Predict year three common ways.
Enter a Underdog Predict net result for a federal range under each common route.