FlightAware Files Federal Lawsuit Against Kalshi Over Unauthorized Data Use

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FlightAware initiated legal proceedings against Kalshi on August 10 in the U.S. District Court for the Southern District of New York.
The complaint centers on allegations that Kalshi utilized FlightAware’s proprietary information and branding for flight cancellation trading markets.
The lawsuit includes claims of contractual violations, trademark misuse, and deceptive business practices.
According to court documents, Kalshi informed market participants that FlightAware data would determine contract settlement outcomes.
FlightAware requests multiple forms of injunctive relief to prevent further use of its resources in these trading products.

A major flight tracking service provider has initiated legal action against prediction market operator Kalshi through New York’s federal judicial system. FlightAware demands cessation of trading contracts that depend on its proprietary information and corporate identity. The aviation data company maintains that Kalshi utilized FlightAware resources to determine contract payouts while creating a false impression of partnership between the two entities.

The legal filing, submitted on August 10 to the U.S. District Court for the Southern District of New York, targets four separate Kalshi corporate entities. FlightAware presents multiple legal theories including contractual breach, unauthorized trademark usage, and competitive misconduct. The company requests judicial intervention to halt markets dependent on its data infrastructure.

Core Allegations Target Data Usage

Kalshi introduced trading instruments enabling participants to speculate on airport flight disruptions. Court documents reveal that the platform explicitly communicated to traders that FlightAware data would serve as the verification mechanism for contract resolution. FlightAware maintains that Kalshi provided no advance notice regarding the intended commercial use of its data for market settlement purposes.

The lawsuit further alleges that Kalshi deployed FlightAware’s corporate identity in ways implying endorsement or collaborative arrangements. The RTX Corporation-owned subsidiary asserts that consumers formed associations between FlightAware and these contracts following their market debut. FlightAware contends it provided no backing for these markets and granted no authorization for Kalshi to designate its data as the authoritative settlement source.

Aviation Safety Concerns Surface

FlightAware articulated apprehensions regarding potential consequences of these trading contracts on commercial aviation. The company suggests that markets based on flight disruptions might create incentives for interference with airline operations, despite Kalshi’s policy exclusions for payouts connected to malicious interference or security incidents.

Kalshi suspended its flight cancellation contract initiative on July 16 following widespread public opposition and FlightAware’s formal objections. The contemplated markets focused on aggregate cancellations at individual airports, with trading restrictions applied to certain airport personnel, Transportation Security Administration employees, and labor organization members to prevent insider advantages.

Regulatory Challenges Multiply

The FlightAware litigation compounds existing legal conflicts between Kalshi and various state authorities. New York state prosecutors filed suit against the platform during the previous month, asserting violations of gambling prohibitions. Judicial authorities in Washington and Michigan have implemented temporary restrictions on sports-adjacent event contracts pending resolution of ongoing legal proceedings.

Minnesota regulators adopted an alternative approach. A judicial officer in that jurisdiction permitted both Kalshi and Polymarket to maintain operations during state legal challenges to prediction market platforms. The CFTC has joined the regulatory debate, maintaining that federal statutes should govern the oversight framework for event-based contracts.

FlightAware seeks comprehensive judicial relief preventing Kalshi from further commercial exploitation of its brand or data infrastructure in flight cancellation markets. Kalshi has yet to file a formal response to the allegations, as the broader regulatory confrontation over prediction markets expands across multiple jurisdictions.

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