Missouri countersues Novig, using a federal online-gambling law to try to stop its sports event contracts

Missouri has gone on the offensive in the first of its prediction-market lawsuits. In an 83-page answer and counterclaims filed on November 9, 2026 in Ludlow Exchange, LLC v. Hanaway (E.D. Mo., No. 4:26-cv-01780), Attorney General Catherine L. Hanaway asks Senior District Judge Catherine D. Perry to restrain Ludlow Exchange, LLC, which does business as Novig, from accepting money from Missouri residents.

The filing makes three counterclaims:

• UIGEA (Counterclaim I). The state says Novig is "a person engaged in the business of betting or wagering." Because Missouri law requires a Missouri Gaming Commission licence, the state argues that sports wagers from Missourians are "unlawful Internet gambling." It relies on 31 U.S.C. § 5365(b)(2), which lets a state attorney general seek an injunction in federal court.
• Missouri Merchandising Practices Act (Counterclaim II). The state calls unlicensed sports wagering an "unfair practice." It seeks restitution and civil penalties of up to $1,000 per violation.
• Public nuisance (Counterclaim III). The state cites a 1937 Missouri Supreme Court ruling, State ex rel. Igoe v. Joynt. It asks the court to declare the operation a public nuisance and to enjoin it.

In its answer, the state also lists nine defenses. They include the Tax Injunction Act, the Anti-Injunction Act and unclean hands, the last because Novig "failed to attempt to secure a license" in Missouri. It admits that Colorado once licensed a Novig affiliate.

Solicitor General Louis J. Capozzi III signed the filing. The counterclaims are allegations and have not been tested in court. On November 5, 2026, Missouri moved to consolidate this case with KalshiEX LLC v. Hanaway, No. 4:26-cv-01860 (ECF 20). The case appears on AskSpinner's prediction-market litigation tracker. Related coverage: Kalshi's TRO request and Robinhood's suit, the sixth against Missouri.

Updated November 10, 2026: Added metaTitle and Overview; cited ECF 20 for Missouri's November 5 motion to consolidate with KalshiEX LLC v. Hanaway; and linked the case to AskSpinner's prediction-market litigation tracker without a provisional tracker ID.