New York sues Polymarket, seeks triple gains and $100,000 penalties

New York sued QCX LLC, which operates as Polymarket US, over alleged unlicensed gambling through event contracts. On Sept. 24, Attorney General Letitia James asked a New York state court to stop the company from offering the contracts without a state gaming license. The petition covers contracts tied to sports, elections, culture, and other events. New York seeks a penalty equal to three times Polymarket's gains from the alleged illegal activity. The state also seeks $100,000 for each offering or attempt to offer unauthorized sports wagering or mobile sports wagering within or from New York. The petition does not specify how many offers could qualify for that penalty. New York seeks restitution for customers. The state also seeks damages and disgorgement of money obtained through the alleged violations. The petition asks for an accounting of customers, bets placed, customer losses, and company gains. New York alleges that Polymarket has operated or indirectly operated a sports wagering platform in the state since at least Jan. 23, 2025. The state alleges that Polymarket continued advertising the platform to people in New York. New York argues that Polymarket's contracts qualify as gambling because customers risk money on events outside their control. The petition alleges that Polymarket accepted public wagers without a New York State Gaming Commission license. QCX has been a Commodity Futures Trading Commission-designated contract market since July 2025. New York's lawsuit therefore raises a dispute over federal derivatives oversight and state gambling laws. New York alleges that Polymarket advertised sports and other event markets to New York residents. Investigators said the platform offered markets involving the New York Mets, college football games, the New York governor's race, and the television show Big Brother. The petition alleges that Polymarket repeatedly advertised and solicited New York users through the internet and social media. New York requires mobile sports wagering operators to hold a state license. The attorney general also alleges violations of the federal Wire Act involving sports wagers, information used to place them, and payment confirmations sent across state lines. Polymarket allows users aged 18 and above. New York requires mobile sports bettors to be at least 21. The state asks the court to prohibit Polymarket from allowing people under 21 to wager on the covered contracts. New York seeks a permanent injunction against operating an unlicensed gambling business within or from the state. The requested injunction would cover advertising, marketing, and solicitation for the contracts. Kathy Hochul said calling the products a prediction market does not change the application of New York gambling laws. James said Polymarket's conduct targets vulnerable people and deprives New York families of services and support. New York says gambling tax revenue supports schools, youth programs, and treatment for problem gambling. The lawsuit follows similar New York actions against Coinbase Financial Markets, Gemini Titan, and Kalshi.