Key Takeaways
- FlightAware filed a lawsuit against Kalshi and withdrew it less than 24 hours later. The case was dismissed “without prejudice,” so FlightAware can file it again.
- FlightAware said Kalshi used its flight data and company name without permission for markets about U.S. flight cancellations.
- After the lawsuit was filed, Kalshi removed FlightAware’s name from the contract page but kept the flight-cancellation markets open.
Flight-tracking company FlightAware withdrew its lawsuit against prediction market Kalshi on August 12, less than a day after filing it.
FlightAware had accused Kalshi of using its data and brand name without permission for markets tied to U.S. flight cancellations. Neither company explained why the lawsuit ended so quickly.
A Lawsuit That Lasted Less Than 24 Hours
FlightAware filed the case in the U.S. District Court for the Southern District of New York on August 11. It asked for damages and a court order that would stop Kalshi from using its data. By the next morning, FlightAware’s lawyers had voluntarily dismissed the case.
The case was dismissed “without prejudice.” This means FlightAware still has the right to file the lawsuit again later. Because of that, the dispute may not be over. Neither FlightAware nor Kalshi responded to Reuters’ requests for comment about the sudden dismissal.
What FlightAware Originally Alleged
FlightAware said Kalshi was offering markets that allowed users to bet on how many U.S. flights would be canceled. According to the lawsuit, Kalshi referred to FlightAware’s data and company name without FlightAware’s knowledge or approval.
FlightAware said this was an unauthorized use of its intellectual property. It wanted money damages and a court order to stop the markets. The complaint also created a public-relations problem for Kalshi because prediction markets depend on trusted data sources to settle their contracts.
Kalshi’s Quiet Website Update, with Broader Legal and Regulatory Context
After the lawsuit was filed, Kalshi changed its flight-cancellation contract page. The page had named “Flight Aware” as the source used to verify results. Kalshi replaced that name with the more general term “Primary Source Agency.”
However, the link connected to that label still sent users to FlightAware’s website. Kalshi also added a notice saying the source agency did not endorse the markets. It said references to the agency’s data were only descriptive and did not mean the two companies were connected.
The flight-cancellation market for the week ending August 14 stayed open during the dispute.
The FlightAware dispute is not Kalshi’s only challenge in the courts. The New York State Attorney General has also sued Kalshi, arguing that its prediction markets are unregulated gambling under state law.
Kalshi is regulated at the federal level by the Commodity Futures Trading Commission, or CFTC. That system allows Kalshi to offer contracts based on real-world events. But some state regulators view the products differently. This has created an ongoing conflict over whether federal approval protects Kalshi from state gambling laws.
What’s Next
Because FlightAware dismissed the case without prejudice, it can sue Kalshi again. The disagreement over FlightAware’s data rights has not been officially settled. It is not known whether the companies are discussing a private agreement or whether FlightAware simply chose not to continue the case.
The episode also points to a larger issue for prediction markets. As companies like Kalshi offer contracts on more topics, they may rely on outside data providers that do not want their names or information used. Kalshi also continues to face pressure from state regulators, so important questions about its business remain unresolved.
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