Good afternoon, everybody.
Thanks for joining.
I'm Attorney General Josh Call.
I'm here today to announce that the Wisconsin Department of Justice today has filed lawsuits
against multiple companies and their affiliates alleging that they have been facilitating illegal
sports betting in Wisconsin.
The defendants in these cases include Kelsey, Robinhood, Coinbase, Hollymarket, Crypto.com,
as well as affiliates of those companies.
Except in limited circumstances, sports betting and other forms of commercial gambling have
long been illegal in the state of Wisconsin.
No company is above this law, no matter how creatively those companies try to disguise
the activity that they're engaged in.
As we allege in these lawsuits, these companies have chosen to flout Wisconsin law by thinly
disguising the sports betting that they facilitate through what are called event contracts.
But our position in this case is that event contracts are no different than ordinary sports
bets.
The companies collect a fee we allege for every bet that's made, leading them to earn
significant revenue from Wisconsinites through violations of our state's gambling regulations.
So we are asking the court in this case to declare that making sports-related events
contracts available for trading by customers in Wisconsin is a violation of Wisconsin statutes.
But these companies have repeatedly and openly violated those laws.
And we're asking for the sports betting that we allege is going on and illegal to be shut
down.
So with that, I'm happy to answer any questions folks have about these new cases.
Good afternoon, everyone.
We will now take on topic questions from media members.
If you have a question, please raise your hand.
I will call on you in the order in which you ask your question.
Once we call on you, we will promote you to panelists that you may speak.
This may take a second.
As a reminder, if you're on your phone, you can press star nine to raise or lower your
hand and star six to mute or unmute yourself once you're called on.
The first question will go to Eric Gunn.
Thank you very much.
Is this just a Wisconsin case or is it a multi-state?
Are you with a number of other states that are filing also against these defendants?
This is a Wisconsin specific case, though I would note, Eric, there are similar cases
in a number of other states.
Next question goes to Matt Smith.
Hi, Attorney General, thank you.
Is this related at all to the governor signing the online sports betting bill?
There's no direct relationship between the two.
What we are alleging is violations of Wisconsin law and the allegations would be the same
whether or not there had been the new legislation passed.
The only connection is that they relate to the same topic, which is online sports betting.
Next question goes to Kate Morton.
Hi, quick question.
I was also wanting to ask about this new law that Governor Evers signed.
How if at all this could play into that and also wouldn't this just strengthen the tribe's
role in online gaming if and when these gaming compacts are revised in the state?
The new law won't have bearing on what's alleged in this suit because the new law specifically
relates to gaming that is conducted through facilities that are on tribal lands and with
Wisconsin, that's not the case in these cases and so the allegations here are unimpacted
by that new legislation.
Next question goes to Todd Richmond.
Hi, two questions, can we get copies of these lawsuits ASAP?
And also, what other states have sued and similar to this?
Yeah, so first in terms of the copies, we, if we haven't already sent out a release,
we will be shortly.
That will include a copy of the complaints.
So if anybody needs that and doesn't receive that, please feel free to contact our office.
We'll get that to you.
In terms of the states, there are a handful of states where there were lawsuits that have
been brought in New York state, just recently filed one and we can get you a more comprehensive
list, Todd, if that's helpful.
There are also a number of states where companies that are alleged to have engaged in this activity
have themselves preemptively filed suits to try to prevent the states from bringing enforcement
actions.
Next question goes to Kimberly.
Yeah, what is your message to people who use these apps who may be impacted by this lawsuit?
Our focus in this case is on the large companies that are operating these.
As I mentioned, the defendants here are Kelsey, Robinhood, Coinbase, Hollymarket, Crypto.com,
and their affiliates.
And so we are taking action to uphold Wisconsin law and ultimately seeking to shut down the
sports gambling operations that we allege that those companies are engaging in in Wisconsin.
Next question goes to Jason.
Mr. Attorney General, thank you so much for your time.
Do you know how much money these companies have made on Wisconsin bets?
We don't have Wisconsin specific information in the complaint.
We make reference to reporting that indicated that Kelsey, for example, made about $1.3
billion in a year that's not Wisconsin specific, but we do know is that, and frankly, if you
watch television commercials during a significant sporting event, you can see this.
There's been widespread promotion of this activity and just simply going online, you
can see how an alleged sports back could be placed.
Next question goes to Jesse.
Hi, thank you.
That's sort of technical question.
When you refer to event contracts, is that interchangeable with prediction markets or
is it a subset of that activity?
The platforms where this is taking place are known as prediction markets and what we allege
is that the way these companies have framed this is that you can, on those prediction
markets, purchase what they call an event contract.
What we allege here is that the event contracts on sporting events are indistinguishable legally
or practically, for that matter, from sports betting and constitute sports betting under
Wisconsin law.
Next question goes to Todd.
Yeah, I know that you said there is no relationship between the bill the governor signed in these
lawsuits, but the timing is just blatant.
I'm wondering, did the tribes request that these lawsuits be filed, or is this a precursor
to some kind of the new compact negotiations that the state must shut these operations
down at the request of the tribes?
Yeah, a couple of things I'll say, Todd.
So first, in terms of your question about the timing, I mean, one thing that I think
is clear is that there has been a huge increase in this type of activity that we allege is
occurring in recent years, and that has had a number of consequences.
And I certainly think that that may very well be linked to the fact that there was legislative
activity on this topic recently, just as there has been litigation activity.
But Wisconsin is not unique in bringing litigation activity on this topic, like I mentioned,
as I indicated in New York.
For example, just recently filed suit, and there are suits in other states as well.
Ultimately, in this case, the decision that we make, I'm certainly aware that folks, there
are folks out there who want to see these laws enforced, but the decisions that we make
are based on the facts and the law, and that's what drove our decision to file the suit.
These suits, I should say.
Next question goes to Molly.
Hi, I was wondering if you're seeking monetary damages, and if not, why not?
Our primary focus right now is on shutting down the activity that we allege is unlawful
sports betting that's being facilitated by these defendants.
Now as the case moves forward, if we are foreclosing what we may do, but if we think that
there is an adequate legal basis to seek some sort of relief and that the facts support
that, we're not foreclosing that, but right now our primary focus is on shutting down
the activity that we allege is illegal sports betting.
The next question, we'll go to Jason, and this will be our last call for questions,
so if anyone else has a question, please raise your hand after Jason, and we'll call on you.
Jason, you're next.
Does this complaint apply to just sports, or does it also apply to wages placed on world
events like the war in Iran and politics like who's going to be the next president?
The focus of these complaints is sports betting specifically.
We allege that that's a very large percentage in the case of Kalshi, for example, of what
takes place on their prediction market platform.
So the focus of this is specifically on alleged sports bets.
Next question goes to Sarah.
Hi, the Trump administration recently issued an order reclassifying medical marijuana as
well as FDA approved products that contain marijuana, and that's medical marijuana in
states that license it.
Will this order have any effect on Wisconsin, and if so what, and do you have any thoughts
on what this order might signal going forward?
Yeah, I saw the reporting that there has been this reclassification.
I have not yet had a chance to analyze what the Trump administration has said.
Of course, in Wisconsin, currently marijuana is criminalized, and so where I think there
may be an impact is if the laws in Wisconsin change, then we would need to see how this
federal update applies with respect to those changes of Wisconsin law.
All right, thank you.
We do not see any other hands raised, so we are going to conclude today's press conference.
Thank you all for joining.
If you have any further questions, please don't hesitate to reach out to the DOJ communications
team at dojcommunications at doj.state.wi.us.
Thank you.
Thanks everyone.