New York lawsuit accuses Polymarket of running illegal sports gambling platform
A New York man has filed a proposed class action lawsuit in federal court accusing the operators of the Polymarket website of running an illegal online sports gambling platform while presenting it as a lawful “prediction market.”
The complaint, filed February 4 in the U.S. District Court for the Southern District of New York, was brought by Lorenzo Miro San Diego. He says he is suing on his own behalf and on behalf of others who used the platform. The defendants named in the case are Blockratize, Inc., doing business as Polymarket, Adventure One QSS, Inc., doing business as Polymarket.com, and QCX LLC, doing business as Polymarket US.
San Diego is asking the court to allow the case to move forward as a class action and has requested a jury trial. While the filing does not yet lay out specific damages, it seeks relief for San Diego and a proposed class of similarly situated users.
At its core, the lawsuit argues that Polymarket is not what it claims to be. The complaint says the site is marketed as a “prediction market,” but in practice functions as an unlicensed sports betting operation that runs afoul of state gambling laws.
Claims focus on prediction markets versus sports betting
In a section titled “Nature of the Case,” the complaint says the dispute stems from the defendants’ operation of an online platform that lets users wager on the outcomes of sporting events and other real-world events. The plaintiff argues that this activity is illegal sports gambling, not lawful prediction market participation.
According to the filing, the way the platform is presented to users masks how it actually works. While customers are told they are buying and selling prediction contracts, the lawsuit claims the mechanics and purpose closely resemble traditional sports betting. Those types of operations, the complaint says, require proper licensing under state law.
The lawsuit also alleges that the defendants own and operate Polymarket through the website Polymarket.com, making it accessible to users across the country. By doing so without the necessary approvals, the complaint claims the defendants are violating multiple state laws that prohibit unlicensed sports betting enterprises.
The New York case comes as Polymarket faces increasing legal pressure elsewhere. In Nevada, a state court recently issued a temporary restraining order against the platform after regulators argued it was offering unlawful sports wagering to residents. The order sought to block Polymarket from continuing operations in the state while the dispute moves forward.
That Nevada action reflects broader scrutiny of online prediction markets tied to sports outcomes. Regulators there argued that labeling the products as prediction markets does not change their underlying nature as sports betting under state law.
In the New York complaint, San Diego says his claims are based on an investigation by his attorneys, along with information and belief. Any allegations tied directly to his own use of the platform, the filing says, are based on his personal knowledge.
As of the filing date, no response from the defendants had appeared on the court’s docket.
ReadWrite has reached out to Polymarket for comment.
Featured image: Polymarket / Canva
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