FlightAware has filed a lawsuit against prediction market platform Kalshi, alleging the company used proprietary flight cancellation data without authorization to power contracts on its platform. The claims include trademark infringement and reputational injury.

FlightAware Sues Kalshi Over Unauthorized Flight Data Use

Kalshi operates a CFTC-regulated prediction market where users trade binary contracts on real-world events, including flight cancellations. Binary contracts pay out a fixed amount if a specified event occurs and nothing if it does not. FlightAware, one of the world's largest aviation data aggregators, argues that Kalshi drew on its proprietary data feeds to settle or structure those contracts without securing a proper licensing agreement. The complaint positions the data as a commercial asset with clear ownership, not a freely available public resource.

The trademark infringement angle extends beyond a straightforward data licensing dispute. FlightAware contends that Kalshi's use of its data or branding created false impressions about an authorized commercial relationship, damaging the company's reputation with partners and clients who rely on the exclusivity and integrity of its data products. Kalshi has not publicly detailed its defense, but the company could argue that flight cancellation information is sufficiently public that licensing restrictions should not apply, or that its use qualifies as transformative under fair use doctrine. Whether those arguments hold in court will depend heavily on how the data was accessed and presented within Kalshi's platform.

This is not Kalshi's first regulatory collision. The platform spent years in a protracted dispute with the Commodity Futures Trading Commission over whether its event contracts constituted legal derivatives or illegal off-exchange options. A federal court ultimately sided with Kalshi in 2023, clearing the way for it to operate under CFTC oversight. That regulatory win made Kalshi one of the most closely watched names in prediction markets. The FlightAware lawsuit arrives at a sensitive moment: Kalshi has been expanding aggressively into real-world event categories, and a loss here could force the platform to renegotiate data arrangements across multiple verticals simultaneously.

State-level gambling comparisons cited in the complaint carry significant weight. Several state attorneys general and gaming regulators have scrutinized prediction market contracts as unlicensed gambling products, an argument the CFTC has largely rejected at the federal level. FlightAware's legal team appears to be using those state findings strategically, framing Kalshi not just as a data thief but as a platform operating in legally contested territory. That framing, if accepted by the court, could complicate Kalshi's ability to argue it is a legitimate financial services provider entitled to the same data access norms as a conventional exchange.

The broader stakes extend well beyond these two companies. Prediction markets have expanded rapidly since Kalshi's court victory, with platforms now offering contracts on everything from election outcomes to economic indicators. Each of those contract categories depends on authoritative data sources to determine settlement. Aviation data, weather data, economic releases and sports statistics all come from providers who have built business models around licensing fees and usage controls. If Kalshi prevails on a fair use or public domain theory, it could weaken the negotiating position of data vendors across the sector. A FlightAware victory, conversely, would signal that prediction market operators must treat proprietary data feeds with the same contractual rigor applied in traditional financial markets, where exchanges pay significant licensing fees to index providers and data vendors.

No trial date has been set. The outcome will be closely watched by any platform whose settlement logic depends on third-party data it has not explicitly licensed.